Bajaj to launch new motorcyles

Investment of more than Rs 100 crore likely for expansion at Chakan plant, though company is yet to finalise the plan

Bajaj Auto, the country's second largest producer of motorcycles, is to launch a series of new products, double capacity at one of its factories and launch a new brand this year.

The Pune-based company will launch new products in the budget (100cc), executive (110-150cc) and sports (150cc and above) segments, despite the broadly sluggish demand.  A budget motorcycle under an existing brand is also to be launched later this month and a new product in the Rs 1-2 lakh category under the Pulsar brand. Presently, the Pulsar RS200 is the only model priced above Rs 1 lakh.

Further a new motorycle brand, to hit the market this quarter, in the executive segment. This is to co-exist with the struggling Discover brand but will be positioned differently. Eric Vas, president (motorcycle business) at Bajaj, said: “This new bike will sit above Rs 45,000 and below 65,000, which is where all the executive bikes are priced. The Discover appeals to a youthful customer; this new brand will appeal to a mature one.”

In addition, the company has decided to increase production capacity at its Chakan unit, near Pune, to accommodate the new launches while also supporting the export market, which contributes to 45 per cent of total volume.

The capacity at Chakan will thus be doubled to 200,000 units a month from the present 100,000.

The likely investment is at least Rs 100 crore; the plan is ye to be finalised.   “Chakan is at present running above (full) capacity. This (expansion) programme will take some time,” Vas added. It has two other plants, at Pantnagar (Uttarkhand) and Aurangabad.

The company had indicated a market share target of 23 per cent by end-March in the motorcycle segment. At end-November, it was 18 per cent, showed data from the Society of Indian Automobile Manufacturers (Siam).

Owing to increased demand for the newly launched Avenger series, its production is to be raised to 30,000 units a month by March from the current 20,000 a month.

Vas said export of the Avenger was yet to begin.  The Discover brands has been reduced to two models, 125 and 150. Bajaj hopes that with the new model, sales should increase to 70,000 units a month from 20,000 a month currently.

The company says it is leader in the entry and sports segments, with a combined market share of 36 per cent. The two segments are 43 per cent of the total domestic two-wheeler market. The executive segment is half the motorcyle market, says Vas.  

The company announced an increase of 13 per cent in market share in the entry segment (Rs 45,000) to close last calendar year at 36 per cent. Similarly there was an increase of nine per cent in the mass sports segment, priced below Rs 100,000.