In a significant move, Mercedes-Benz India has exported a batch of left-hand-drive GLE SUVs to Europe during the fiscal year 2023, showcasing the prowess of its Chakan plant in Pune. This development gains prominence as it aligns with the ongoing efforts of the Indian government to initiate a Free Trade Agreement (FTA) with Europe and the UK, aiming to stimulate imports, especially in the electric vehicle (EV) segment, and pave the way for Tesla’s swift entry into the Indian market.
India-Made GLE SUVs Conquer European Roads
Mercedes-Benz India has marked a historic moment by exporting made-in-Chakan GLE SUVs to Europe, marking the second instance of such a shipment in the past five years. The left-hand-drive units, manufactured in the high-capacity Chakan facility, emphasize the adaptability and efficiency of Mercedes’ Indian manufacturing operations. While the exact batch size remains undisclosed, this move is anticipated to set the stage for expanded exports in the post-FTA landscape.
Strategic Export Amid Capacity Utilization Surge
At a time when Mercedes-Benz India is operating at high-capacity utilization rates, reaching levels of 85-90 percent, the decision to export GLE SUVs to Europe reflects the brand’s commitment to meeting global demand. The Chakan plant has witnessed increased production demands, leading to the implementation of three shifts to accommodate the surge in orders.
FTA’s Potential Impact on India’s Export Landscape
The export order of BR167 LHD vehicles for the European market, as indicated in Mercedes’ FY2023 financials, aligns with the potential benefits that an FTA between India, Europe, and the UK could bring. Experts suggest that India’s cost-effectiveness and established quality standards position it as a viable contender to cater to these markets. While still speculative, the recent exports serve as evidence of India’s capability to deliver on global demands, hinting at future prospects post the EU-UK FTA era.
A Glimpse into the Past: Mercedes’ Export History from India
This export endeavor echoes Mercedes-Benz India’s previous milestone in 2018 when the company shipped GLC SUVs to North America. Back then, India served as a strategic backup base for the German luxury carmaker, addressing the demand for the SUV in the North American market during a specific period.
Future Horizons: Export Potential in Post-FTA Era
The culmination of these export initiatives suggests a potential surge in India-made cars reaching international shores, driven by favorable FTAs. If the doors open further through an FTA, India’s automotive industry, backed by competitive costs and quality standards, could play a pivotal role in meeting global demands.
