German luxury car maker, BMW plans to increase the manufacturing capacity of its Chennai plant to more than 3,000 units per annum as it expects sales in 2008 to touch 2,000 units.

The company is targeting the top position in India in the luxury car segment over the next three to five years and has decided to focus on the Indian auto sector. It also plans to invest Rs. 3 crore in streamlining its production capabilities.

Speaking at the launch, Peter Kronschnabl, President BMW India said, "We have beaten our target of selling 1,000 units in 2007 by successfully delivering 1,387 vehicles and this has also led to increase in our capacity to 3,000 units per annum from 1700 units on a single shift basis."

Last year, the company sold 320 units of its five series car, 251 units of its seven series, 743 units of its three series and six units of the SUV X3.

The company is also putting in place an aggressive plan for development of a larger dealer network across the major metros of the country. Phase I of the dealer network expansion plan would include 12 dealers by the end of 2008.

The company is also conducting a market study on the feasibility of a small car in the luxury segment.

“We have not decided on our plans for small cars in India... but are conducting a study to analyze the market,” Kronschnabl said.

The BMW study is scheduled to be completed over the next three months, after which the company would decide whether to introduce the small car in India or not.