Indian Motorcycle eyes smoother ride in 2018

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Indian Scout Sixty
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The Indian premium motorcycle market has been growing at a steady pace in the past several years. Though 2017 was a challenging year due to some disruptions, the premium bike makers are bullish on the growth opportunities in India. The favourable growth outlook has attracted several global premium bike brands into India.

The snazzy bikes at the showrooms of premium brands continue to see a rush of young, affluent Indians.

After a challenging year in 2017, American niche bike maker Indian Motorcycle expects to see a smooth ride in India in 2018, aided by the new product launches and stable market environment.

A wholly-owned division of Polaris Industries, the company is focusing on 1200-cc and above superbike market in India and sells nine models, including the recently launched Scout Bobber with price starting at Rs 12.99 lakh (ex-showroom). Automotive Script spoke to Pankaj Dubey, Country Head and Managing Director, Polaris India Pvt. Ltd about the year passed, market potential and its plans.

He said 2017 was a tough year because of various regulatory changes that came in. First came the effects of demonetisation which impacted the market for quite some time. Business did get affected and then it was temporary.

Then came the Supreme Court ban on BS III vehicles. It had put some knee-jerk problem though we were aware that something like this will happen but never expected that it will stop in two days notice.

The move impacted the entire industry because we were unaware and stuck with a lot of inventory. A lot of financial losses were borne by the company including ours.

First of all, everybody tried to dispose off the BS III vehicles in two days time and hence companies had to shell out lot of money in the marketplace.

After BS IV came into the picture, the prices went up because BSIII to BSIV technology changed and the cost went up. This had an impact. After that in July GST came into existence and it also had some impact due to uncertainties over rates. Everybody was trying to liquidate the old stock and again companies lost a lot of money.

“We are CBU manufacturers our product is completely built up from US to India that’s where the prizes went up. So, in 2017 lot of knee jerk in business that impacted the business quite a lot. Hopefully, 2018 should be a good year,” said Dubey.

The all-new IndianR ScoutR BobberHe then went on to discuss the premium bike market in the country. The company is happy that more and more buyers are coming into its fold. Though 2017 was a challenging period, the company expects the market to resume strong growth this year.

During April-December 2017, the above 800 cc market clocked total volumes of about 2200 units as against about 2100 units in the year-ago period.

GROWTH OUTLOOK IS BRIGHT 
The premium bike market has been growing quite nicely at a CAGR of 20 per cent plus. Overall the market will expand and it will continue to grow for another decade or two. Per capita income is increasing and hence people will have more disposable incomes, he said.

With more and more millionaire getting added every year in the country, they will seek to explore life in a unique way. With money in their hands, they will want to pursue some passions which they couldn’t afford earlier. This is what driving things like community biking, pointed out Dubey. Mr. Pankaj Dubey, MD & Country Head, Polaris India Pvt. Ltd.

Explaining the structural changes in the two-wheeler market, he said the two-wheeler market comprises largely 100-150 cc models, but mostly dominated by 100 cc bikes. However, in the recent years, 150 cc has been seeing some traction.

The bigger part of the story is the exponential growth in the high-end cc segments – 350 cc, 500cc and 750 cc and above categories.

These high end bikes find a different set of audience – those who seek more power and speed. With numerous players, this market has become a fiercely competitive now in India.

“The number of people who really aspire to own bikes of global brands is increasing, he said.

Indian Motorcycle’s customers comprise largely businessman, entrepreneurs, CEOs of the companies and other passionate bikers. These people love biking as they feel it is like an expression of their freedom.

“They treat the bikes as part of the family. Most of the customers are high network individuals largely from A and B towns,” he said.

Indian Motorcycle has created Indian Motor Riders Group (IMRG) in order to offer international biking experience. “One unique thing we are doing is while doing IMRG we give opportunities to our customers to contribute to the social cause. We have created a panel of wings for change, under which we focus girl child education as the primary thing.

“We honour the people who do a great job in girl child’s education and we have been doing these kind of activities for the last one year, he said.

STRONG PRODUCT OFFERING

With the appetite for snazzy bikes in the country continues to rise, Indian Motorcycle has a strong product strategy and offers a very wide portfolio. Among the nine models sold in India, its flagship model is Roadmaster, which has very high acceptability among the customers.

“Currently, whatever we have in the product range globally, we bring it here. Even the new products will hit the Indian market immediately after its launch in the US, said Dubey.

The company is spending a lot of time and energy to get the product very quickly to India.

“Our strategy is to offer a high-quality product experience to the customers. More and more who get to ride our product highlight that Indian Motorcycle is a premium product and it’s very comfortable to do long distance drive. We are making effort to get more people get to know the qualities of the product. We are approaching the customers through digital medium too,” he said.

In addition to strong digital marketing, the company organises a lot of motorcycle rides on its own as also through the dealers. It has also been undertaking several activities across the country to bring interested bikers under one platform.

“We are doing these initiatives to make the customer happy and for the community expansion,” explained Dubey.

DEALERSHIP EXPANSION

The company has dealerships across Gurgaon, Bengaluru, Chennai, Hyderabad, Mumbai, Ahmedabad and Chandigarh. It has plans to expand the service network in more locations.

“Because of the industry slowdown, the company did not open any new dealership in 2017. We are planning to open dealerships at least in three locations – Cochin, Jaipur and Mumbai – in 2018,” said Dubey.

He pointed out that the company was giving a strong focus on training to staff at its dealerships. It has a training facility in New Delhi and offers training to dealers, technical team and sales people from time to time.It has practical demonstrations on the new features that get added into the products.

“Since these are all high-end bikes and are high in electronics and digital, servicing has to be done very differently. Hence, continuous training is a key to maintain service quality,” he said.Though its customers are mostly in metros and Tier 1 cities, the company also see growing interest in Tier 2 and other locations.“We have some customers from Tier 2 cities and they have bought our bikes,” he said.

For most of the super bike brands in India, the big markets are metros like NCR, Mumbai, Bangalore,Hyderabad, Pune. However, tier 1 and tier 2 cities like Chandigarh, Jaipur, Kochi and Bhubaneswar, among others have shown a high level of acceptance of the premium bikes and are exhibiting bright growth prospects.

With the country’s population becoming younger & richer and the youth becoming aspirational, the growth in this bike segment is expected to be robust.

Asked whether it was planning a manufacturing unit in India, Dubey said: “We explored that option. But we do not have firm plans as of now when we would to start. We are closely watching the market and also the kind of volume that we will have to do in order to justify the investment into manufacturing or the CKD operation.

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