Indian Leader Wants to Leave Mark on Mobility SceneFri, 09/01/2017 - 14:11
Smaller vehicles can help solve mobility problems and as the consumer increasingly is more informed, motorcycles are gaining greater acceptance as a viable transportation option, says Sergio Mirensky, Director General of Bajaj Motocicletas.
After only four years in Mexico, India-based Bajaj has positioned itself in the domestic market as a fast-growing company. For 2017, it expects sales of 50,000 motorcycles, having sold 30,000 bikes in 2016. Mirensky says globally, investors have a positive perception of the transnational company. It produces approximately 4 million vehicles per year in four plants and investors appreciate that it leans on market research to make decisions, carries out R&D and manages competitive plants.
Few motorbike companies are manufacturing or even assembling locally, neglecting to take advantage of economies of scale the automotive industry could offer motorbike companies. Bajaj, however, has an assembly plant in Tultitlan, State of Mexico, where it puts the finishing touches on its utility, commuter and sports two-wheelers.
“Manufacturing in Mexico has experienced dizzying growth, boosted by the commercial area. We already need to install more production lines or more shifts to meet sales demand,” says Mirensky. He explains that its Mexico plant faces challenges related to contracting, training and controls, mainly because it aims for perfect assembly operations to make the vehicle functional. Despite these challenges, the local operations are reporting strong results, Mirensky says. Historically, Bajaj has worked with 100cc and 200cc models but it wants to introduce motorcycles with larger displacements. Mirensky believes that Mexicans are becoming more critical in their choices, comparing prices and products, so there is space for different brands. “There are different Bajaj products, price ranges for different budgets and we want to give the best value possible at the best price,” he adds.
Despite its successes, Mirensky sees much work ahead in Mexico. “The motorcycle market keeps growing in the country but it is not yet at the level of countries like Colombia, Brazil, Argentina,” he says. “This is related to the car-centric culture that dominates the market.” Bajaj is focusing on broadening its portfolio before expanding its alliances to boost customer satisfaction. It also plans to offer a shopping and service experience that could be a competitive advantage, along with its focus on providing excellent customer service and sound financing plans.
In Mexico, Grupo Autofin distributes Bajaj’s products according to the Indian maker’s international business model that places a master distributor in each country, which then selects and operates a local company with the capabilities to complement the parent’s vision. Grupo Autofin offers customers technology, quality and innovation according to their purchasing power, based on its experience as a leader in car distribution, a model that is replicable for the distribution of motorcycles.
According to many international newspapers like the Economic Times, Ducati has been looking since the beginning of 2017 for a partner in India like Bajaj. This is to make smallengine bikes in order to get into a bigger competition with global markets. Regarding the possibility of the company joining forces with Ducati, the Director General says: “if tomorrow we were to enter into a partnership with Ducati, we would operate exactly the same way, holding a stake in the company. We would leave business strategies, marketing and designs all to the other party, Ducati in this case, and we would support some manufacturing issues where we can add value to the product.”
There is a great opportunity to increase the company’s position in the Mexican motorcycle market thanks to several factors, according to Mirensky. “Mexican consumers are more than aware of the price of gasoline here, and the general advantage of motorcycles over cars is that they use much less fuel.” The company performed a test in a typical route on the streets of Mexico City to compare the times and costs of a motorcycle against public transportation and private vehicles. In the end, motorcycles proof more advantageous. “This was proof that regardless of whether a buyer has the money to buy a car, the motorcycle presents a reliable mobility option and it is growing in popularity every day,” Mirensky says.