Mercedes-Benz Eyes Local EV Assembly in India to Achieve Sustainability Goals
Depending on market demand, Mercedes-Benz India will assemble its flagship electrified luxury car, the EQS, at its Chakan facility.
Mercedes-Benz India is assembling its flagship electric luxury sedan, the EQS, at its Chakan unit. Depending on market demand, the company is considering localizing other electric vehicle (EV) models.
Sustainability Goals by Mercedes-Benz:
Mercedes-Benz aims to achieve zero-emission mobility and a carbon-neutral setup, which includes not only tailpipe emissions but also the recyclability of the cars and the carbon footprint generated during production. “Our final goal is zero-emission mobility and a carbon-neutral setup,” stated Santosh Iyer, Managing Director & CEO of Mercedes-Benz India.
Iyer emphasized a holistic approach to EV production, saying, “We have to look at this holistically. Therefore, producing EVs was the logical step, and we will continue in that direction as the market demand changes.”
Benefits of Local Assembly:
Local assembly offers several advantages:
- Cost Reduction: Localisation helps bring cost advantages. For instance, the locally assembled EQS is available at around ₹1.5 crore, which would be more expensive if imported.
- Knowledge Gain: Local production helps gain valuable knowledge about EVs, which is crucial for long-term strategy.
- Flexible Production: Mercedes-Benz’s production plant can handle both EVs and combustion engines, providing flexibility.
Global and Local Sustainability Targets:
Globally, Mercedes-Benz aims to make its fleet of new vehicles net carbon-neutral by 2039. This includes achieving 100% renewable energy use in production plants and reducing CO2 emissions per passenger car by 50% by the end of the decade compared to 2020 under the Ambition 2039 initiative.
When asked about future EV assembly plans in India, Iyer mentioned that it depends on market demand. “We are considering… it is a factor of demand also in the market that we see because to localize, you also need certain threshold volumes,” he said. He also hinted at the possibility of more localized products in the future.
Mercedes-Benz Sales Growth and Indian Market Response:
Mercedes-Benz reported a 9% growth in sales in India, with 9,262 units sold in the first half of 2024, marking its highest-ever half-yearly sales in the country. EVs accounted for over 5% of total sales volumes, with a 60% growth in EV sales compared to last year.
