Mobor (Goa): Unfazed by a possible threat to two-wheeler sales by the much-hyped Rs 1-lakh car by the Tatas, Bajaj Auto on 9 September said price is not a factor in governing purchase decisions but it is the overall “ownership cost” that plays a pivotal role.
“We are not worried about the Rs 1 lakh car. Price is a small factor which influences purchase decisions, the more crucial factor is the ownership cost,” Bajaj Auto Ltd (BAL) Managing Director Rajiv Bajaj told reporters here.
He said a majority of the automobile purchases are covered by EMI and it is the overall running cost in the end, that makes the real difference.
“Ownership cost of a car comes to about Rs 10,000 per month whereas it is only Rs 3,000 per month in case of bike. There is a huge cost difference for a majority of customers,” Bajaj said.
Industry analysts predict that Rs 1 lakh car will dent the sales of entry-level bikes. However, they expect the two-wheeler industry to maintain steady growth in the high-end bike segment.
Bajaj Auto itself is in the preliminary stage of discussion with French car maker Renault to jointly work on a small car project.
Bajaj said it would be difficult for an entry-level customer to bear the differential in cost of ownership.
“My customer who drives a Pulsar 220 cc has a different profile. He drives it for leisure,” Bajaj said.