Still not easy to do business in India: Vikram Pawah

In an interview with FE’s Vikram Chaudhary, Vikram Pawah, President, BMW Group India, Australia and New Zealand shares new buying trends in the luxury car market, and adds that there is some way to go before it’s truly easy to do business in India.

On Thursday, BMW India launched a new car, the 2 Series, with an aim to attract younger customers. It’s a gran coupe, and a stylish vehicle. It’s made in India, and in addition to the X1, the 2 Series, priced Rs 39.3 lakh onwards (ex-showroom), is also the company’s entry-level offering. Vikram Pawah, President, BMW Group India, Australia and New Zealand, calls it a made-in-India global car. In an interview with FE’s Vikram Chaudhary, he shares new buying trends in the luxury car market, and adds that there is some way to go before it’s truly easy to do business in India.

Why has BMW India launched an entry-level, small luxury car, the 2 Series?

I wouldn’t call the 2 Series a small car; it’s quite spacious. It’s a gran coupe (better than a sedan), and stylish as well. The reason we’ve launched it is that people want to enter the luxury segment at a younger age. In addition to the X1, the 2 Series is now our main entry-level offering. It would attract a lot of younger audience in urban areas, with a cosmopolitan mindset. It’s also loaded with technology, and is a made-in-India global car.

How do you think has the lockdown changed car-buying habits of Indians?

The world over we are now seeing new trends. One is the focus on personal mobility—this trend is good for us. The second trend we are seeing is that people are spending more time with their families, like planning more road-trips with the family. The third trend is becoming more aware about sustainability; in the area of cars, it means more efficient engines.

Why, in your opinion, BMW India’s sales share has risen over the last 3-4 years?

It’s a combination of factors. We had a clear strategy on products, on dealerships, on customers, and on correcting the perception about the total cost of ownership of luxury cars. Today, I must say that the maintenance cost of BMW petrol cars is as low as `1 per kilometre, and those of diesel cars `1.5 per kilometre.

What is your plan of launching electric cars in India?

I would love to bring our electrified cars to India, but what we are watching is policy framework and the infrastructure. It’s very important for us to give an uninterrupted experience to our customers. We will bring these to India when we are sure that a customer can drive, let’s say, from Delhi to Jaipur uninterrupted.

How easy or difficult is it to do business in India?

It’s not really easy to do business in India. Even though as an Indian I understand the system, I understand why things happen the way they happen. Let’s take the example of Atmanirbhar Bharat. It’s a great initiative, it’s about developing the economy, it’s about ‘Make in India’, but it shouldn’t lead to shutting ourselves down to the latest technologies. I say it very clearly that we (premium carmakers) are being penalised for bringing in the latest technologies to India, in the form of very high taxes. There is tax in-equalisation between luxury and mass-market cars; if you correct that you would enhance the value of the entire auto industry, and that would mean more tax collection for the government. We need to see the bigger picture. Yes, everywhere there is a price difference between luxury and mass-market cars, but it is not as large as it is in India; it kind of distorts the market.

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