BMW India is planning to lease out cars to individual customers who are not willing to purchase cars.
The luxury car maker will lease cars for specific periods and then take them back for re-sale.
BMW, which edged out Mercedes-Benz to be the number one car maker in the Indian luxury car market in 2009, is looking to consolidate its market share in the 9000 units-a-year luxury car market.
The lease business will also help the German car company to build inventory for its used car business, the BMW Premium Selection, to be launched by the year end. Under this, BMW will sell cars returned by customers after some years of use as well as the company-owned fleet used by its own executives. The company will re-furbish these old cars and sell them under its own warranty and also provide complete service backup through its dealers just as it does for its new cars.
BMW India president Peter Kronschabl said, “In the three years of operations we have realised that a large number of customers want to own a BMW product, but not exactly buy it at the regular ex-showroom price. We are leasing to companies but this is the first time we are tapping individual customers.”
BMW sold 3,619 units against Mercedes Benz's 3,247 in 2009. It will also invest $50 million in its auto loan business, BMW Financial Services, to provide retail finance to BMW buyers and dedicated finance to dealers. The business will also provide automotive insurance cover to customers with a local partner.
BMW has also announced plans to manufacture its entry-level SUV, the X1, at its Chennai factory by the year end. The new SUV will be the cheapest car from the BMW stable.