TVS to wind up assembling activities in China

Indonesian arm to launch 200cc sports motorcycle, 110 cc scooter

TVS Motor has said it will wind up local assembly operations in China.

“After a complete review of the proposed activities through SBDC, it was advised that local manufacturing operations may not be required in China. Hence, the board has decided to retain the Representative office in China but to close down the operations of SBDC,” the company said in its annual report.

Meanwhile, TVS Motor's Indonesian arm has said it will launch a 200 cc sports motorcycle and a new variant of its 110 cc Dazz scooter in 2015-16. 

This is the first time TVS Motor or any of its subsidiaries is launching a 200cc motorcycle. The company's highest version yet, both in the domestic and international market, is the 180cc TVS Apache.

The company said it has invested an additional $4 million in the Indonesian arm (PT TVS Motor Company Indonesia).

The motorcycle industry in Indonesia declined by 3%, and the decline was more pronounced in the last quarter of the financial year, TVS said. Industry growth as a whole slumped 17% due to weak consumer sentiments.  

TVS' scooter category grew by 6%, triggered by new product launches, to end the year with a share of 70%. The sports motorcycle category and bebek category declined by 10% and 25% respectively.

PT TVS introduced two variants of the 125cc sports motorcycle during the later part of the year, according to company's annual report.

During 2014-15, PT TVS sold 23,300 vehicles as against 19,200 vehicles sold in 2013-14, a growth of 21%. While the domestic sales remained flat, exports grew by 40%. PT TVS exported more than 14,000 units to ASEAN, Middle East and African countries.

During 2014-15, the loss at EBITDA level was marginally lower at $8 million compared to loss of $9 million reported in 2013-14.

Earlier TVS Motor Company (Europe) B V & TVS Motor (Singapore) Pte Ltd were incorporated by TVS Motor to serve as special purpose vehicles for making and protecting the investments made in overseas operations of PT TVS.

Considering the change in the evaluation, the company has initiated steps to voluntarily wind up TVSM Europe, subject to such regulatory approvals / consents as may be required, both under Indian/foreign laws. The other overseas entity - TVS Motor Singapore Pte Ltd will continue to hold the investment in PT TVS.

During the year under review, the company has made an additional investment of Rs 2.01 crore in the ordinary shares of TVS Motor Singapore Pte Ltd and the shares were allotted in April 2015.