According to reports in the media, Bajaj Auto is all set to turn the tables on Chinese motorcycle manufacturers by taking them on at their own game – making and selling ultra-low-cost two-wheelers for developing markets.
Bajaj Auto is said to have arrangements in place with certain companies in China, which would, on a contract basis, manufacture 125cc bikes for Bajaj. These bikes would be sold at the equivalent of around Rs 20,000-25,000 in some of Bajaj’s export markets, including China and Africa.
However, Bajaj will not sell these low-cost two-wheelers under its own brand. The company, which wants a high-quality, high-tech image for its brand, will develop an all-new brand for its low-cost lineup of Chinese-built bikes.
In the 100-125cc bikes segment in India, Bajaj has fallen behind chief rival Hero Honda. Under the new strategy, the company’s new range of Chinese-built bikes might ultimately also be introduced in India – perhaps by 2010 – to take on Hero Honda in the 100-125cc segment.
In the meanwhile, the Chinese are said to be selling more than 12 million low-cost bikes per annum, worldwide. And Bajaj Auto wants a significant chunk of that market with its own Chinese-built motorcycles – an objective which, if achieved, will add tremendously to the company’s bottomline.