Mercedes-Benz India is spending INR3bn (US$62.4m) upgrading its car assembly plant in Pune, Maharashtra state, and on strengthening its dealer network nation-wide.

The investment is primarily to prepare for the launch of the redesigned E-class line expected by the end of the year.

Mercedes India uses up to 50% local components in the current Indian-assembled E- and C-class models but the 'made in India' parts count for the top S-class is currently only around 25%.

Last year, Mercedes sold 3,625 cars in India, up 50% year on year, at prices ranging between INR6.5m to INR10m ($135,200-$208,000).

The company is recruiting 80 more engineers for its R&D unit at Bangalore, bringing the total on the site to 300.

It is also investing INR1.5bn ($31.2bn) to expanding its network of dealers in 25 cities by 10 more outlets.

The German automaker also recently spent INR25bn  ($520m) to boost bus and truck output at its Pune commercial vehicle factory.

M-B sees Volvo as its main CV competitor here in India. It recently signed an MOU with the Maharashtra State Road Transport Corporation (MSRTC) to supply inter-city buses and is also in talks with the Karnataka State Road Transport Corporation (KSRTC) about supplying both inter-city and city buses.

The new buses are expected on the road by the end of this fiscal year, a senior Mercedes Benz India official said.

Kevin Jacobs