BMW officially opened its new assembly plant in Chennai, India, today (29 March). The new factory is the automaker’s fifth plant in Asia.

The plant is a completely knocked down (CKD) kit-building plant with capacity of 1,700 units a year in single-shift operation, and employs 120.

At the opening ceremony, chairman Norbert Reithofer said BMW sold 136,000 cars in Asia in 2006 and hopes to sell 150,000 a year there by 2008.

He added that BMW is forecasting the Indian market will grow from 1.2m vehicles today to 2.2m vehicles in 2015 while sales of premium cars are expected to double in the same time.

BMW has opened a subsidiary office in Delphi and the Chennai plant at a cost of EUR20m. In the medium term it expects to employ around 200 people at the two locations.

Management board member Frank-Peter Arndt  said BMW chose Chennai for its plant due to well-developed infrastructure, availability of local suppliers and a well-trained and highly motivated workforce.

The plant occupies 89,000 square metres, including a production area of 13,000 square meters. Since February, it has built 3 series models for India.

Production started after construction time of just a year. BMW will add 5 series production later. Plant processes include pre-assembly, final assembly and finish.

According to Automobilwoche, around 1,000 3 and 5 Series cars will be assembled at the plant this year.

BMW sold 257 imported cars in India in 2006. Cars assembled in the country avoid a 60% tariff levied on completely built-up imports (CBUs).