Start-ups should not take us lightly, says Bajaj Auto MD

During the launch of new Pulsar motorcycles, Rajiv Bajaj, MD, Bajaj Auto, compared the business models of legacy players and start-up firms. He further said that start-ups should not take us lightly.

By:October 29, 2021 8:03 AM
Bajaj Pulsar 250

 

Start-ups and electric vehicles (EVs) may be the flavour of the times, but Rajiv Bajaj, MD of Bajaj Auto, said these firms should not take lightly the power of good two-wheeler companies such as Bajaj Auto, Royal Enfield and TVS Motors. Bajaj referred to these as BET and said he would rather lay his bet on the BET companies than on the start-ups in the two-wheeler space such as Ola, Ather, Tork, Smarty, which he dubbed OATS.

Bajaj said BET companies deliver vehicles soon after launch, in less than a month, but OATS launch vehicles in 2021 and deliver in 2022. “The champion players eat OATS for breakfast,” Bajaj said. He was speaking at the launch of the two all-new Pulsar 250 cc motorcycles at the Akurdi plant.

Comparing the business model of the start-up firms and the legacy players, Bajaj said: “Their business mode is a cash-burn model. Our business is a cash-flow model. We have to make sure we make money. So we operate very differently. There are start-ups and the biggest is Ola but we have to see see them produce something.”

He drew attention to the fact that the Indian two-wheeler makers had battled four Japanese companies successfully in the 150 cc and above category sports motorcycle space vehicles with the BET companies controlling 70-80% of the market-share. KTM and Triumph Motorcycles came to Bajaj Auto for partnership because of the trust and confidence in the company’s engineering capability and ability to meet their standards, Bajaj pointed out. “If big names in the world of motorcycling think it fit to partner with Bajaj and respect what the company has done, they must be very good at what they do,” he said.

Ola Scooter founder Bhavish Aggarwal has been dismissive about the legacy automakers He had said the scooters available in the country had not innovated for decades and that the vehicles were boring, dull, old, slow, clunky and out of sync with the market aspiration. Their EVs were even worse than their ICE counterparts in almost every aspects, Aggarwal had said, launching the Ola S1 e-scooter, which were to start deliveries in October.

Quoting Charles Darwin, Bajaj said it is not the most intelligent or the strongest species that survive but the ones that are most adaptive to changes. “The sign of a champion in the auto industry is when you are able to adapt and Bajaj Auto is a 75-year-old company that has adapted over and over again and could do the same with the electric disruption,” he said.

On the new online distribution model of the start-ups, Bajaj questioned the absence of the “touch-and-feel experience” and the retail experience. Be it the Apple store, a fashion or auto store, there is a lot to be said for that experience. “In our view the retail experience is important and that is why when we open up cities for Chetak, we start with the Chetak experience centres as much as possible,” he said.

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