Yamaha Plans to Make India Global Hub for Premium Bikes

Japanese automobile major Yamaha is planning to make India the hub to manufacture premium motorbikes for global markets. In the pastyear, the company registered a three-fold increase in two-wheeler exports from India, driven largely by the growing international demand for high-end bikes.

We will fully utilise the infrastructural facilities that we have set up here in India to push our exports further, said Pankaj Dubey, national business head of India Yamaha Motor (IYM).

The Indian unit supplied 66,904 bikes in fiscal 2010 to Yamahas global operation, compared with 38,639 units in 2008-2009. These two-wheelers were sold in countries such as Colombia, Sri Lanka, Indonesia, Kenya, Bangladesh and the Philippines.

Yamaha exports bikes such as Gladiator Type SS, FZ16, YZF-R15, Crux, Enticer, Alba and G5 out of India. We are seeing a huge demand for exports, which grew at 73% in the past year, said Mr Dubey. In contrast, demand for Yamaha bikes in India grew at 25% in the same period.

According to Ernst & Young India, all major automobile manufacturers are looking at lowering cost of operation, a major reason why India is becoming important as a manufacturing hub. India offers lower cost of component sourcing, and Yamaha has a better presence in the premium segment, said Kapil Arora, partner-automotive practice, Ernst & Young India.

The focus on selling high-end bikes in the 150cc category and above has worked well for Yamaha. This year, the company has gained a 12% share of the $8-million two-wheeler market, up from a share of 5% in 2006. Now, the company targets to increase its share in the premium and deluxe segment to 20% by 2010-end. This segment is very crucial for us, as currently it is the main growth driver for our company, said Mr Dubey

At present, Yamaha is ranked fifth in the Indian two-wheeler market and it is dominated by Hero Honda, Honda Motorcycles, Bajaj and TVS Motors. In the previous year, Yamaha sold 223,307 motorbikes in the Indian domestic market, compared with 162,370 units in 2008-2009.

Yamaha will also expand its product portfolio in India by launching a scooter that will tap into another growth segment. We are currently conducting a feasibility study and will finalise plans depending on customers demand, said Mr Dubey. As per the data by the Society of Indian Automobile Manufacturers (SIAM), In the financial year 2009-2010, the two-wheeler industry clocked growth of 26% in the domestic sales and 13.54% in export.

ET