Bajaj and Triumph tie-up to launch mid-range motorcycles in sub 500 cc segment

Bajaj Auto in a BSE filing said that this would be a non-equity partnership and is betting big on benefiting from the collective strengths of both the companies.

By: | Updated: August 8, 2017 2:41 PM

Bajaj - Triumph

Indian motorcycle manufacturer Bajaj Auto and Triumph Motorcycles UK have joined forces to develop a range of mid-capacity motorcycles. Bajaj Auto in a BSE filing said that this would be a non-equity partnership and is betting big on benefiting from the collective strengths of both the companies. Bajaj’s statement read that We hope to bring to bear upon global markets the individual strengths of the partners including brand position & perception, design & development technology, quality & cost competitiveness & worldwide distribution. This partnership will bring in new products at a global level and will also enable Triumph Motorcycle to expand its reach by entering new markets giving them access to sell more volumes especially in the emerging markets across the world. On the other hand, Bajaj Auto will get access to the iconic heritage British brand which will allow the Chakan based motorcycle manufacturer to widen its product portfolio in the domestic and international markets. While we wait for more details on products, investments and timelines the statement further said that both the companies are excited to join forces and excited to enter new market segments that will cater a whole new group of motorcyclists across the globe.

Bajaj Auto is the largest Indian motorcycle exporter and also owns over 47% stake in Austrian motorcycle firm KTM and was a former partner to Kawasaki for eight years that supported with sales and service. Bajaj’s alliance with Kawasaki ended on 1st April 2017. Earlier, Rajiv Bajaj, MD, Bajaj Auto had hinted on a new partnership by saying "We are very close to finalising a very promising alliance. It's not certain that it will happen, but if it happens, it will open up enormous possibilities for the company". Bajaj Auto along with the promoter of KTM, Stefan Pierer were also in the race to buy stakes in VW Group’s Ducati says a report on ETAuto.

In a telephonic conversation, Vimal Sumbly, MD, Triumph Motorcycles India told us that “We are excited about this new partnership;  This will allow us to venture into new market segments in India and many other emerging markets.” While more details on the new motorcycles are still not disclosed but it is likely that Bajaj Auto will develop and manufacture this mid-range motorcycle from its plant from its Chakan plant with design and many other inputs provided by Triumph Motorcycles. Bajaj and Triumph have not shared any details on the investment amount required to develop and manufacture these new motorcycles.

Triumph Motorcycles recently cancelled its plan to invest Rs 850 crore in a new manufacturing facility in Karnataka and with the announcement of this partnership it is likely that Triumph may build smaller displacement motorcycles from Bajaj’s plant in near future. With the help of Bajaj, KTM increased its global sales volume from 65,000 units to about 200,000 units annually. While debuting in India in 2013, Triumph had shown interest in making India as an export hub to emerging markets.

Rajiv Bajaj had earlier told shareholders at the Bajaj's AGM “That is why we keep our money (cash on books) with us, so, once in a while, when an opportunity comes along, we are ready.” Bajaj Auto holds free cash of about Rs 13,250 crore. With KTM motorcycles and its own Pulsar brands Bajaj has managed to cater to the sportsbike segment with ease but there are "geners in the portfolio that were missing" as per Rajiv Bajaj. He now wants to address the needs of easy or lazy riders and with Triumph, Bajaj hopes to venture into it as a premium brand.

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