bike makers in india

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Bike Makers Gear up to Ride Cross-Country

Japanese challengers Honda & Suzuki to vie with Indian champions

Hero & Bajaj in entry level

RAJIV SINGH NEW DELHI

As Honda and Suzuki shed their premium tags,strap on helmets and

drive into the hinterland,the country is gearing up for cutthroat

competition between the Japanese challengers and Indian

champions Hero and Bajaj in the entry-level bike segment.The entry

level,or commuter segment,which includes motorcycles powered by

75-125 cc engines,accounts for 70% of the worlds second-largest

motorcycle market.Its a consuming segment,so everybody wants to

have a share of the ever-growing pie, says VG Ramakrishnan,senior

director,automotive practice,at Frost & Sullivan.Low ownership of

two wheelers,rising incomes in rural and semi-urban areas and

increasing number of youngsters in the country are among factors

that will help this segment grow and accelerate.This bread-

and-butter segment will continue to gallop and give volumes to the

bike makers, Ramakrishnan says.Bike makers are most aggressive

in the 100-125 cc segment (bikes priced between.38,000

and.50,000).Within a span of less than a month,this segment

dominated by the likes of Heros Passion and Splendor,BajajsDiscover and TVS Star Sports has seen a flurry of launches such as

Suzuki Hayate,Bajaj Discover 125 ST and Honda Dream Yuga.And

theres more to come as bike makers gear up to flood this sector

with aggressively priced new products and variants.Reason The

commuter segment has been the fastest-growing segment in Indias

10-million-units motorcycles market,steadily growing its share from

48% in 2005-06 to 65% in 2010-11 to 70% now.Analysts say its set

to explode at an even faster pace.

UNDER-PENETRATED MARKET

s of India Publications http://lite.epaper.timesofindia.com/mobile.aspx?article=yes&page

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While India trails only China in terms of the number of twowheelers

sold in a year,penetration level in the country is still much lower than

other emerging markets such as Brazil,Indonesia,Thailand and

Taiwan.Almost 80% of households do not own a two-wheeler,and

40% of the population has no mode of transport,a recent report by

PINC Research says.Also,the demand for twowheelers in now

mainly driven by rural India.While twowheeler household penetration

in rural India more than doubled (between 2001 and 2011) to

14.3%,the growth in urban India was more sedate growing from

24.7% to 35.2%, says the report published in March.While anincrease in crop prices over the last few years has left larger

disposable incomes with rural people,non-agrarian sources of

income is also on the rise,says another report by credit rating and

market research agency ICRA.Around 60% of the rural economy

depends on non-agricultural sources of income such as remittances

from cities,trading,and employment in the manufacturing sector,says

the report.With rural incomes rising and roads connecting more

villages in the country,rural India will continue to drive the

two-wheeler market.Thats why foreign two-wheeler makers are now

headed for rural India.

FROM CLASS TO MASS

India is a classical mass market.In order to make it big in the

country,foreign brands will have to shed their premium tag and

plunge into mass market,say analysts.The strategy to straddle all

segmentsfrom class to masshas paid rich dividends to multinationals

such as Samsung (consumer durables as well as mobiles) and

Nokia.Prathap Suthan,chief creative officer of Bang in the Middle,an

independent advertising agency,says foreign brands will have to

sacrifice western idiom for Indian signatures to make it big in the

country.In a market where aesthetic quotient of the buyer is still

rudimentary at best,the brands will have to lower their appeal and

adapt to Indian sensibilities, he says.This is what Honda has done

with Dream Yuga,its newly launched first 110cc bike for mass

marketa potent combination of English Dream with Hindi Yuga.With

450-odd million making up the market and with monies to spend,it

would be unwise not switching to Hinglish, says Suthan.The

Japanese auto majors choice of Bollywood star Akshay Kumar as

its first brand ambassador in India is also done with an aim of

capitalising on Akshays mass appeal,especially in smaller cities and

towns.We have roped in Akshay Kumar as brand ambassador for

mass acceptance and emotional connect in the market, a Honda

India spokesperson says.Another Japanese major,Suzuki,donned a

desi avatar last month by roping in Dabangg Salman Khan for its

first motorcycle in the mass segmentHayate,a 112 cc

bike.Meanwhile,Japanese bike majors romance with rural India may

give sleepless nights to Indian auto biggies,especially HeroMotoCorp,which has 55% share of the market.

HERO VERSUS HONDA

Hero will be hit most by Hondas mass play, says Frost and Sullivans

Ramakrishnan.With the entry of Dream Yuga,he says its a direct

fight between Hero and Honda as Bajaj is not a real competitor in

the entry-level segment.Honda,the world's largest motorcycle

manufacturer,has been steadily raising production and sales across

the two-wheeler segment since it ended a 26-year joint venture with

Hero Moto-Corp in March last year.This April,Honda Motorcycle and


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Scooter Indias sales grew nearly 50% year-over-year,and it

overtook TVS Motor to become the third largest two-wheeler maker

in India.While Honda is racing to catch up with Hero,Indias largest

bike maker is betting big on its flagship brands Splendor and

Passion as well as two new models to ward off any threat in the

commuter segment.The company has more than 70% share in the

segment up to 125 cc,Hero MotoCorp Senior VP (Marketing &

Sales) Anil Dua says.Splendor and Passion each clocked million-plus

unit sales in 2011-12.With the planned launch of two new bikesthe

125cc Ignitor and the 110cc Passion Xprolater in the year,we areconfident of further strengthening our leadership position, Dua

says.Bajaj Auto,the second-largest player,too is strengthening its

portfolio in the commuter segment.We continue to be the second

largest two-wheeler manufacturer in India in April,and have a

significant lead over the third-largest manufacturer, says K

Srinivas,president -motorcycle business,Bajaj Auto.In March,Honda

had pipped Bajaj by a few hundred units to become the second-

largest twowheeler maker for the month,thanks to its leadership

position in the fast-growing scooter market.More than 60% of its

sales come from scooters.We will continue with our focused

approach as a motorcycle specialist, Bajajs Srinivas says.


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