Mercedes-Benz plans to make a strong supply chain for critical parts through its Indian vendors. The German automaker is in the process of increasing localisation in its cars to take on arch rival BMW. BMW has started a price war of sorts, with all its cars being cheaper than the Mercedes counterpart. The Stuttgart based company also plans to utilize its suppliers for its global orders. This would help the company to reduce dependance on one single supplier.

“We need to look for suppliers not just for us but for Mercedes factories around the world. We will need to get Indian suppliers to meet global quality and delivery schedules. The tragedy in Japan has shown the danger of relying on just one source. We need multiple suppliers, at least two or three, although having just one supplier keeps costs down. The events in Japan have also shown that just in time is good but you also need a buffer stock,” Mr. Peter Honegg, MD and CEO, Mercedes-Benz India, said.