Advertisement


Advertisement

Thread Rating:
  • 5 Vote(s) - 3.4 Average
  • 1
  • 2
  • 3
  • 4
  • 5
Bajaj to stop scooter production, focus on motorcycles
Advertisement
#1
The jingle promised that it would stay with us for today and tomorrow as a Strong Symbol of a Strong India, and two generations grew up humming the tune. But finally when the India of the licence-permit raj gets to take its seat at the global high table, the scooter that got us there is fading away.

Bajaj Auto announced on Wednesday that it is exiting the scooter segment altogether, bringing the curtains down on its iconic product line. The company had stopped making the Chetak, once the world’s largest selling scooter, almost three years ago, and according to its MD Rajeev Bajaj, it will stop production of its non-starter Kristal series by end of the current fiscal.

“This is a definite watershed moment, because it’s almost like detaching ourselves from what constitutes middle class India, and the set of values that constituted middle class India,” says Santosh Desai, MD and CEO of Future Brands and a marketing and advertising expert.


Bajaj Auto says it will now focus on making motorcycles. “There was a time for horse carriages, and there’s a time for bikes. Today, the bike symbolises middle class India,” says R Balki, chairman of Lowe India, the agency that created the legendary Hamara Bajaj commercials of the eighties. “Bharat is changing, Buland is changing, Bajaj is changing,”
he says.

For Hamara Bajaj, the big change came in the late nineties when the onslaught of the “Fill it, Forget it” Hero-Honda tilted the two wheeler market in favour of motorcycles overnight.

A decade before that, getting delivery of a Chetak used to command waiting periods of years, so much so that Rajeev Bajaj’s father and Bajaj Auto chairman Rahul Bajaj once dared the government to arrest him for exceeding government permitted production limits.

A parallel industry grew around that waiting period, with those taking the delivery reselling it at handsome margins.
Bajaj’s main rival then, LML, collected more than Rs 120 crore just from customer bookings of Rs 500 per scooter. Half of these were never delivered, and the company folded up soon after the motorcycle surge.

The next generation Bajajs decided to focus on bikes, yet scooters managed to stay put. In the late nineties, Chetak shifted gear from its two-stroke engine to four-stroke with new gadgets. Then came its automatic avatars.

Hero-Honda’s India partner Honda Motors queered the pitch once again with its Activa line of advanced scooters. It now sells over 6 lakh scooters a year in the million-units market.

As for Bajaj scooters, things went from bad to worse. Kristal sales dropped 57% to 3,356 from 7,876 scooters in the first eight months of this fiscal year, even as the domestic scooter market saw a 15% jump to 8.91 lakh units in the same period.

“Currently, we are making our Kristal only for exports, which we don't think is viable. So, we plan to exit the scooter business by the end of this financial year,” Rajeev Bajaj said on Wednesday.

Ironic then that Hero-Honda, whose bikes still sell like hot cakes, is looking at increasing production of its only scooter, the 100cc Pleasure. “Scooters are proving to be a stable product and we are not able to produce enough to meet demand. We shall take our annual production to over 2 lakh scooters to meet the demand,” says Hero Honda’s senior VP for marketing & sales Anil Dua.

Rival TVS has also just launched an automatic scooter Wego. Other players like Suzuki and Mahindra Kinetic are also launching new scooter models. Ditto with Yamaha Motor, which is planning to foray into the scooter segment with strong demand coming from urban markets. But Rajiv Bajaj begs to differ. “If we are to be a motorcycle specialist, we cannot make scooters,” he says.

Reply
Thanks given by:
Advertisement
#2
Consumer demand also needs to be taken into consideration if it stoops then it will have to reduce its manufacturing but a reduced production will be better option to maintain its iconic product line rather than its stoppage.
Reply
Thanks given by:
Advertisement




Possibly Related Threads...
Thread Author Replies Views Last Post
  General News: Bajaj Auto Pulsar NS160 launched in India, priced at Rs 80,648 nairrk 0 1,028 06-30-2017, 07:00 PM
Last Post: nairrk
  Bajaj Pulsar RS200 launched SRK 0 995 03-26-2015, 09:30 PM
Last Post: SRK
  Bajaj Pulsar RS200 trailer SRK 0 1,146 03-18-2015, 08:06 AM
Last Post: SRK
  Bajaj Pulsar 200 SS bookings open SRK 0 1,063 03-15-2015, 09:21 PM
Last Post: SRK
  Bajaj Chetak is coming back in 2016 SRK 0 1,012 03-10-2015, 05:43 PM
Last Post: SRK
  Bajaj Pulsar 150NS has 17PS & 13nm power SRK 0 807 03-10-2015, 07:18 AM
Last Post: SRK
  DTH News: Maruti stops Swift production Kanwar 0 1,819 07-08-2011, 12:38 PM
Last Post: Kanwar
  General News: Bajaj launches new Discover bike at Rs 45,500 nairrk 0 2,486 03-31-2011, 05:38 PM
Last Post: nairrk
Information Help: Ford to stop production of bestseller Ikon nairrk 0 1,348 02-09-2011, 08:14 AM
Last Post: nairrk
  Help: Royal Enfield increased production.!!! nairrk 0 1,256 11-17-2010, 12:11 PM
Last Post: nairrk

Forum Jump:


Users browsing this thread: 1 Guest(s)
Advertisement