Mercedes-Benz is looking to strengthen its Indian supplier partnerships to support its global operations, with component exports emerging as an immediate opportunity ahead of any potential large-scale export of finished vehicles from the country.
Mercedes-Benz Group Chairman Ola Källenius, speaking at a media roundtable in Pune, said the company was expanding its technology and supply partnerships in India, with the potential to serve markets beyond the domestic market.
“We can, if you will, export out of India on a component basis before you ask the question, on a full vehicle,” Källenius said, highlighting the growing importance of Indian suppliers in the company’s global supply chain.
He noted that the company’s technology and supply partnerships in India were progressing steadily, adding that Indian suppliers could develop into global partners, similar to Mercedes-Benz’s established relationships with suppliers in Europe, the US, Japan, South Korea and China.
“These are worldwide relationships. They’re not confined to one region,” he said.
On the possibility of expanding vehicle manufacturing and exports from India, Källenius said such a move would depend on domestic market growth and the availability of suitable products at competitive price points. While no decision has been taken, he indicated that a larger manufacturing commitment could eventually become a reality.
“I think that is more a question of when as opposed to a question of if. We have not made such a decision at this point,” he said.
Källenius estimated India’s premium luxury vehicle market at around 60,000 units annually, within an overall passenger vehicle market of approximately five million units. Mercedes-Benz sells around 20,000 vehicles in India, giving it a significant position in the luxury segment. However, he said there remained considerable scope for further expansion.
The company’s immediate priority would be to strengthen its domestic business, with India’s economic growth expected to support significant expansion over the next five to seven years.
Alongside domestic sales growth, Mercedes-Benz plans to increase India’s contribution to its international operations through stronger supplier relationships and greater engineering responsibilities.
Källenius also welcomed the India–European Union Free Trade Agreement, noting that lower trade barriers could encourage cross-border business and improve export opportunities.
“If you have less friction, the likelihood of export transaction is higher,” he said, describing the agreement as positive for both regions and businesses.
However, he did not announce any specific vehicle export programme, manufacturing commitment or volume target.
India’s growing automotive supplier ecosystem, established manufacturing capabilities and engineering talent provide a strong foundation for Mercedes-Benz to expand its operations in the country. The company already operates its largest research and development centre outside Germany in India and has more than three decades of local manufacturing experience.
Describing India’s role in the company’s global strategy, Källenius said its contribution would extend beyond vehicle sales and manufacturing to include engineering, technology development and global sourcing.
“We have all the ingredients,” he said, adding that India’s role in the Mercedes-Benz global network should be viewed as a comprehensive opportunity.
“So this is not a one-dimensional play. You have to look at this. India in the Mercedes world is a 360-degree play.”