New Delhi: Despite new import duty norms on completely knocked down units, luxury car maker BMW India on Tuesday said it will not raise the prices of its locally produced models, 3 and 5 Series sedans and SUV X1, as it has already been assembling the engines of the vehicles here.

"At this point of time, our completely knocked down (CKD) operations are fully fulfilling the new regulations. We are paying 10 per cent duty... There will be no price hike," BMW India President Andreas Schaaf told reporters here.

The ex-showroom prices of 3 and 5 Series cars in Delhi starts at Rs 24.4 lakh and Rs 37.6 lakh, respectively, while the X1's price begins at Rs 22.4 lakh.

For pre-assembled engines, transmissions and gearboxes, customs duty was fixed at 30 per cent in the 2011-12 Budget as against 10 per cent earlier.

"In our engines, about 50 per cent of the assembly is done in India. So it is considered as locally produced," he said, adding, the company has been assmebling its engines and transmissions since the launch of these models in the country.

2 years to comply CKD norms

Heavy Industries and Public Enterprises Minister Praful Patel said his ministry has asked the Finance Ministry to give two years' time to the auto industry to comply with the new CKD norms.

When asked about seeking the two-year timeline despite meeting the new guidelines, Schaaf said: "We are of the belief that any regulation should not be changed overnight but should be implemented planfully over a period of time. So we are a part of the SIAM's request to extend the timeline".

He also expressed disappointment on the government not consulting the industry before hiking the customs duty.

Last week, rival Mercedes-Benz India had said that it started assembling the engines and transmissions of C and E Class sedans at its Chakan facility. It is, however, producing the S Class sedan by paying 30 per cent customs duty and it is likely to hike the price by about Rs 8 lakh within one month.

Sales grow 80 per cent in 4 months

Speaking about BMW's sales, Schaaf said: "In the first four months, our sales have grown 80 per cent. Our target is to hit 10,000 units sales mark during 2011".

BMW became the market leader for the second consecutive year after it sold 6,246 units last year, thus displacing Mercedes Benz, which sold 5,819 cars in 2010.

Schaaf said BMW will start assembling its SUV X3 at Chennai from June and will evaluate options to launch smaller cars like 1 Series and hatchback Mini in India in future.