Bajaj Auto will launch a new 125cc motorcycle every quarter through 2008-09 as part of its endeavour to get away from the 100cc space.
The first to roll out will be the XCD Sprint MUMBAI: Bajaj Auto will launch a new 125cc motorcycle every quarter through 2008-09 as part of its endeavour to get away from the 100cc space.
“There will be one distinct 125cc bike with distinct pricing in each quarter,” managing director Rajiv Bajaj told DNA Money.
The first to roll out will be the XCD Sprint showcased at the Delhi Auto Expo.
The sporty, four-valve 12.5hp bike with the DTS-Si technology will target an exclusive customer base. This strategy will hold true for the other bikes that will follow in the fiscal.
All the four products will emerge from the new platform created for the XCD.
The Pantnagar plant in Uttarakhand could be the most likely production base unless the company decides to use its Waluj facility, too.
The XCD was launched in September last year and was expected to be the answer to Hero Honda’s hugely successful Splendor.
Sales took off with a bang and the company hoped that they would sustain at the 50,000-mark-per month.
However, the last two months have seen the XCD settle closer to 25,000 units instead.
“It is very unlikely that manufacturers can produce a model in this segment which can post volumes of 1,00,000 units a month. What is required is a very clever platform strategy which will create economies of scale. The XCD’s journey over the last few months has been a valuable learning for all of us,” Bajaj said.
With a price tag of Rs41,000 and directly pitched against the Splendor, the XCD has paved the way for the company to consolidate and grow its presence in the executive segment.
It hardly had a standing here prior to this; the 110cc Discover barely announced its presence before it was whisked off the production line.
According to Bajaj, with an increasing number of manufacturers entering the 125cc arena next fiscal, the market would gradually move towards more powerful (and profitable) motorcycles.
“I believe that the 125cc plus segment, which account for roughly 35% of bikes in the market will be up to 65% by the end of 2008-09. As a result, the 100cc will be down to 35%,” he added.
The 100cc Splendor and Passion are the clear leaders in the executive segment with combined sales of nearly 1.8 lakh units each month.
There are other 100cc options in the entry segment (up to Rs35,000 ex-showroom) like the TVS Star, Hero Honda CD and Bajaj Platina, which also do similar numbers every month. However, margins on these bikes are hardly anything to write home about.
It is in the 125cc plus space that Bajaj dominates with the Pulsar, Discover and XCD. Its competitors here are Hero Honda’s CBZ Xtreme, TVS Motor’s Apache and Honda Motorcycle & Scooter India’s Shine and Unicorn. Both Yamaha and Suzuki also have bikes in this segment, though they have not been doing big numbers so far.
TVS will launch the 125cc Flame in the coming days with HMSI tipped to follow suit with a new version of the Shine. Speculation is rife that market leader Hero Honda will also come out with a new 125cc motorcycle next fiscal.
Bajaj reiterated that his company would continue to focus on going up the value chain in motorcycles.
The Discover, for instance, will soon have a 150cc option which means the present 135cc version could gradually be phased out. The Pulsar already has four versions ranging from 150cc to 220cc and could well see more in the 250cc plus entering the market.
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