On exports
A key aspect of the ‘Make in India' campaign is making India an exports hub. How does Mercedes-Benz India look at this aspect? "Again, it is about the volume game because at the moment we are about 15,000 locally produced units. So we are not competitive in terms of volumes! A Mercedes vehicle from India would be significantly more expensive than a Mercedes vehicle from Germany. Why? Because, here we are producing 15,000 and in Germany we are producing 1.2 million! It is about the economies of scale."

Of course, a car that locally produced in India is much cheaper than a car produced in Germany in terms of the Indian market because the tax structure makes it a good business case. "Because parts that are locally sourced and locally manufactured go under different duty structures. Therefore in India, a car that is produced locally is cheaper than a car produced in Germany.

"Very simple! But when you look at it again from a Singapore perspective, a car from India is more expensive. So when does the car export start from India? Once there is a Free Trade Agreement between Indian and Singapore and we have better relations with Singapore than Germany has and their taxation will make our vehicles cheaper than the German vehicles. That will give us the basis for any export," he explains patiently.

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