New Delhi: After a strong performance in the premium segment, Yamaha Motor Co.’s Indian subsidiary plans to up the ante and focus more on the executive segment in which it is lagging behind rivals by a wide margin.
The executive motorcycle segment in India, generally defined as bikes with an engine capacity of between 125cc and 150cc, accounts for at least 70% of sales. The premium segment comprises motorcycles of 150cc and above.
Yamaha’s India unit, which at present has four bikes in the executive segment, faces a unique problem. Consumers generally identify the brand with sporty, trendy and expensive bikes and tend to overlook its offerings in this segment.
Geared up: India Yamaha Motor managing director Yukimine Tsuji wants buyers to take note of bike models in the executive segment too. Ramesh Pathania / Mint
“How do I get consumers to acknowledge our current models?” says Yukimine Tsuji, managing director, India Yamaha Motor Pvt. Ltd, listing one of his main tasks. One way of doing this: introduce new colours and give a facelift to existing models.
Hero Honda Motors Ltd, the country’s largest two-wheeler maker, has been the dominant company in the executive segment primarily due to its dominance of sales in rural India.
In the past, several bike makers have tried to chip away at the company’s dominance. Pune-based Bajaj Auto Pvt. Ltd recently announced its plan to enter this segment.
Still, analysts are sceptical about Yamaha’s plans succeeding. “The competition in this segment is only going to increase,” says Vaishali Jajoo, an analyst with Angel Broking Pvt. Ltd. “Breaking Hero Honda’s lead is going to be very difficult.”
In the next few months, the company plans to step up marketing for these bikes. It has, for instance, come out with a television commercial for the Alba, its 106cc, single-cylinder bike which, because of its higher pricing, is considered to be part of the executive segment though it falls short in engine capacity. So far, most of its Rs400 crore advertising expenditure had been directed at premium 150cc bikes.
Also on the cards is a significant expansion in dealerships. After adding 100 dealers last year, the company plans to add 150 more in 2009, taking the total to 550 across India.
Dealers, who have so far focused mainly on selling premium products, are also being trained to sell bikes for the mass market through grassroots marketing campaigns. Demonstration vans with bikes mounted on them are being sent to dealers to showcase the Gladiator, Alba, G5 and Crux models.
India Yamaha has turned around in the past year. The company at present averages sales of around 17,000 bikes a month, up from just 10,000 a month in March. Last year, it sold 112,063 motorcycles in India, a number it should be able to double this year.
Tsuji said the company expects to raise sales to around 20,000 a month by Diwali, which falls this year in October.
But despite its aim of giving more attention to the executive segment, the firm does not plan to launch any new bikes in this range. Its new launches such as the Fazer, which the company unveiled earlier this month, have been confined to the premium segment.
Yamaha is also studying the scooter market in India, but declined to specify when it plans to launch its first scooter here. “Scooters in India are sold at very low prices compared to elsewhere in Asia and the company has to first understand how to profit in that segment,” Tsuji said.