Bajaj shrugs off sales slump with tech-edge bikes

Rajiv Bajaj, managing director of Bajaj Auto, appears to have quietly steered the company away from the “commuter” bike segment and is hoping that the renewed focus on technologically-superior products should generate not only better profitability, but also increase sales volumes.

Over the last few months, Bajaj has faced some very rough times with domestic sales falling to a low of 65,000 units a month. But a slew of new launches, gradual focus away from entry level bikes and smart pricing appear to have put the company back in top gear.

Domestic sales have already reached the 110,000 per month levels.
“One bad year made us reorient ourselves. We realised that the economical, commuting bike positioning is already taken by someone so we need to create a different positioning for our bikes…We revised our product plans and you can see the results already,” Rajiv Bajaj said on Tuesday while launching the new Pulsar 220 cc.

Bajaj Auto claims that this is the fastest bike available on Indian roads currently with a top speed of almost 144 kmph and ARAI certified mileage of 56 kmpl. It is priced at Rs 70,000 (ex-showroom Delhi).

Bajaj pointed out that each of the new launches done this year: XCD 135 cc, Pulsar 150 and 180 upgrades and now the Pulsar 220 cc, have been successful because of their technological superiority and pricing.

On the anvil is another “blockbuster” bike which, Bajaj claims, will sport the most fuel-efficient engine in India and has been developed in-house. It is slated for launch next month, followed by yet another motorcycle by the end of the year.

“In three-four months from now, our domestic sales should touch 1,75,000 a month. With the launch of the new Pulsar 220 cc, the Pulsar brand should clock 40-45,000 a month soon,” Bajaj said.

So did the oft quoted statement of Bajaj — that his company would vacate the 100 cc space—bear fruit and help the company expand its reach? S Sridhar, CEO of Bajaj’s two-wheeler business, said that the entry-level PLatina (which was competing with Hero Honda’s CD Deluxe and TVS’ Star City) was contributing almost 50% to Bajaj’s overall sales in 2007-08 but accounts for only 35% now. “This segment of the market has crashed, our share in it remains intact,” he said.

He also made it clear that the low-cost bike which Bajaj has developed using Chinese suppliers, is not being launched in India just yet.

To a question on scooters, Rajiv Bajaj acknowledged that though 1,000 units per month of the Krystal are still being sold, the company “has not been very successful” with scooters. On reports of increasing stake in Austrian bike maker KTM, he said that the stake remains at just over 30% and the first joint product of Bajaj and KTM would be launched sometime next year.

On exports, he said that after a dip in the March quarter, export numbers are back to 55,000 a month levels and should go up from here. At present, the XCD platform (125 and 135 cc) does about 20,000 units, P Latina (100 cc and 125 cc) another 45,000 units, Discover 20,000 units and the Pulsar bikes together sell another 35,000 units a month.