After the opening of Mercedes-Benz' first showroom in Kerala at Kochi he said the company is changing its strategy to turn India into a major source for automobile components for its 20-odd manufacturing facilities in different parts of the world.

The new strategy will also help the joint venture in reaching the prescribed target of 70 per cent indigenisation within five years of beginning production, he said. The company has sold 600 cars so far this year and blamed the current slump on the continuing economic and industrial recession all over the world. During last year 1,200 cars were sold in India.

Ziegler said that Mercedes had, perhaps, overestimated the potential of India as a car market but was quick to add that the growth of the market takes a long time. However, the change of strategy will help the company to make its operations in the country profitable.

Mercedes at present exports cars to Germany, Russia, Singapore, South Africa, Thailand and Malaysia.

Mercedes has 12 sales outlets throughout the country. Service centres are attached to the showrooms to ensure that the cars sold are cared for. The company plans to open 14 more showrooms throughout the country, he added. In the meanwhile, Mercedes' 12 and 15-seater travel coaches are garnering a favourable response in the market. The coaches will soon be available in Kerala too he said. The 12-seater coach has been priced at Rs 13 lakh and the 15-seater at Rs 14 lakh, Ziegler said.

He said that Mercedes did not plan to bring out vehicles for the small cars market. Although Mercedes' merger with Chrysler offers it a wide range of small cars that can be launched in India, he said, "We are not planning anything for now."