Garware in a plan to make 250-cc Hyosung bikes in India with new JV

Pune-based Garware group is set to form a joint venture with the South Korean S&T to manufacture and sell motorcycles in India. The company already assemble and sell S&T’s Hyosung heavy bikes in India. “S&T is keen to enter India. We plan a manufacturing JV by mid-2012,” Diya Garware, managing director, Garware Motors told HT. “If and when the JV is formed we will enter the 250-cc segment.”

Garware Motors has set April 20 as the launch date for its first two S&T heavy bikes — the 650-cc GT650R and the 700-cc ST7. “The homologation process is over. We expect to get the ARAI certificate next week,’’ she said.

The company has reduced the noise level and added Indian parts to meet the specifications set by the Automotive Research Association of India (ARAI).

The GT650 and ST7 superbikes will be priced below Rs 5 lakh and Rs 6 lakh respectively.

The company plans showrooms in Delhi, Mumbai, Goa, Bangalore, Chennai, Hyderabad, Chandigarh, Kochi and Kolkata, apart from Pune.  It has set up a Rs 20-crore assembly plant in Wai near Pune, and is targeting annual sales of 2,000 bikes. It is forming a pan-India bikers’ club, Hyfliers, to promote its bikes.

The heavy bike segment is attracting global leaders — Harley-Davidson, Ducati, Suzuki, Yamaha and Honda are all present. Most of these bikes are in the 800-cc plus, Rs 9 lakh-plus range. Garware is trying to carve a 600-800 cc niche.

Auto CKD imports going to be taxed at 30%

The auto industry may be a high revenue generator for the government, but some of the recent policy decisions do not consider this sector’s importance to the exchequer.

Consider this: after a lot of deliberations, the government has introduced a new slab in the budget, which will tax certain completely knocked down (CKD) kit imports at 30%. In this year’s budget the government had proposed 60% tax.

Any kit, which includes pre-assembled engines or gearboxes for either cars or two-wheelers, will have to pay this hefty levy - this virtually includes all CKD imports since engines and gearboxes are typically the last products to be localised.

Of course, the new duty would adversely impact assembly operations of luxury car makers such as BMW and Audi besides bike makers such as Harley Davidson. Spokespersons for both BMW and Audi in India declined to comment on the CKD duty issue. Earlier, senior Audi officials were quoted as saying they will review business in India if the CKD levy were to continue.

Not just luxury car makers, other vehicle makers would also be hit in their respective CKD operations. Industry veterans point out that Suzuki Kizashi, Hyundai Santa Fe, products from the Jaguar Land Rover range, which Tata Motors was planning to import in CKD condition for assembly and sale in India - all these products and their possible assembly here would now be impacted.

After the Ssangyong buyout, Mahindra & Mahindra had also spoken of bringing some of the Korean company’s flagship products to India as CKD - these plans are also likely to get impacted adversely owing to the new import duty levy.

But it is not just the CKD levy that is making vehicle makers see red.

Even the issue of easing excise duty on utility vehicles (UVs) has not been addressed for many years now. The industry has been seeking lower excise - at present UVs are taxed at 20% alongside other big cars - for these vehicles saying they are primarily for use in rural areas and hence should be differentiated from sports utility vehicles (SUVs). Even the Ministry of Heavy Industries (which is the administrative ministry for automobiles) is in favour of such a move, having repeatedly asked the finance ministry to lower excise on UVs by 4-5 %.

In the 220th report of the Committee on Industry, Heavy Industries ministry has said it has recommended, at various stages in the past that the finance ministry bring down excise duty on multi-utility vehicles 4-5% from the existing 20%.

It has also recommended withdrawal of additional excise duty of Rs15,000 imposed on all cars, other than small cars, and has also asked for increasing depreciation rates on vehicles from 15% to 20%.

Suzuki’s 200cc and 500cc bikes in India

When Government Of India opened the gate for superbikes in 2007, everyone expect the Hayabusa and R1 to hit India market. Recently, Yamaha launched superbikes – R1 and MT-01 in India. Now its Suzuki’s turn but unlike Yamaha, Suzuki plans a CKD (Completely Knocked Down) route that means more affordable superbikes.Assembling the bikes in India will cut the cost of a superbike significantly, compared to importing it as a CBU(Completely Built Unit). Also,Suzuki is planning to assemble 400-600cc bikes in India that could see prices of power bikes come down to Rs 4-5 lakh.  Suzuki Motorcycle India V-P Atul Gupta told that the company would shortly be sending some of the bikes to Indian vehicle certification agency Automotive Research Association of India (ARAI), Pune, for homologation. “The homologation process is likely to take between three to six months and we can expect some of these bikes possibly by Diwali,” he said. “Indian Government move to relax certification process for 800-cc plus vehicles (by accepting certification from EU against existing policy of only from the country of origin) would also help in launch of these bikes in India”, he added. Suzuki may bring superbikes like GS500, GSR600 and RMZ-450 to indian market.

125cc,150cc and 200cc..

Suzuki launched  two new models in 2008. While one will be in the 150-cc segment, the other could be a premium offering in the 125-cc segment. Suzuki is also looking at launching a 200 cc bike, though Gupta said a final decision would be taken closer to the launch.

After Honda, Suzuki speeds up 100cc motorcycle plans!

The 100cc segment is suddenly showing some real signs of action with Suzuki Motorcycle India, all set to hasten it’s own foray into the bread and butter, commuter segment of the Indian motorcycle market. This motorcycle segment, which consistently has enjoyed massive volumes and along with delivered huge profits to the two biggest players, Hero Honda and Bajaj Auto respectively. Close on the heels of the Hero-Honda Joint Venture split and Honda deciding to up the ante with it’s own 100cc commuter offering, compatriot Suzuki too is speeding up it’s original plans to usher in a 100cc commuter motorcycle with the sole goal of big volumes.

Suzuki, in fact was one of the first manufacturers to bring a 100cc motorcycle to India in the form of the 98.8cc Ind-Suzuki AX100 Two Stroke commuter motorcycle way back in the eighties, when it had collaborated with TVS Motors. In a way, life has come a complete circle for Suzuki in India even as it has a myriad range of products ranging from the humble Access 125 Scooter to the high end Suzuki Hayabusa sportsbike. With the 100cc commuter motorcycle, Suzuki hopes to make a bigger dent in the ever growing Indian motorcycle market. Here’s what Atul Sobti, the of Suzuki Motorcycle India had to say about his firm’s 100cc foray.

Suzuki decides 200cc and 500cc bikes in India

When Government Of India opened the gate for superbikes in 2007, everyone expect the Hayabusa and R1 to hit India market. Recently, Yamaha launched superbikes – R1 and MT-01 in India. Now its Suzuki’s turn but unlike Yamaha, Suzuki plans a CKD (Completely Knocked Down) route that means more affordable superbikes.Assembling the bikes in India will cut the cost of a superbike significantly, compared to importing it as a CBU(Completely Built Unit). Also,Suzuki is planning to assemble 400-600cc bikes in India that could see prices of power bikes come down to Rs 4-5 lakh.  Suzuki Motorcycle India V-P Atul Gupta told that the company would shortly be sending some of the bikes to Indian vehicle certification agency Automotive Research Association of India (ARAI), Pune, for homologation. “The homologation process is likely to take between three to six months and we can expect some of these bikes possibly by Diwali,” he said. “Indian Government move to relax certification process for 800-cc plus vehicles (by accepting certification from EU against existing policy of only from the country of origin) would also help in launch of these bikes in India”, he added. Suzuki may bring superbikes like GS500, GSR600 and RMZ-450 to indian market.

125cc,150cc and 200cc..

Suzuki will launch two new models in 2008. While one will be in the 150-cc segment, the other could be a premium offering in the 125-cc segment. Suzuki is also looking at launching a 200 cc bike, though Gupta said a final decision would be taken closer to the launch.

Expansion plan:

In line with the expansion of its product range, Suzuki will expand its dealer network to maximise its reach. Suzuki intends to set up a network of 400 outlets over the next three years, compared to 140 stores at present. And, during this period its investment could reach Rs 700 crore while the Gurgaon facility could be churning out 4 lakh two-wheelers by 2010, compared to 1.7 lakh at present.

Superbikes achieve steady motion on Indian roads

Superbikes, defined as bikes with engine capacities of 1,000 cc and above, are finding plenty of takers. The market, which grew more than 60 per cent selling over 2,000 units in 2010, is expected to grow by more than 50 per cent this year.

“People’s incomes are rising and they’re realising that superbikes can be used on Indian roads too,” said NK Rattan, operating head (sales & marketing), Honda Motorcycle & Scooter India. Honda sells superbikes like Fireblade, CB1000R and VFR1200S priced at Rs 9.5-12.5 lakh. “Since 2008, more and more people are buying these bikes,” he added.

The clientele, said Rattan, includes doctors, lawyers, and well-settled professionals in their forties, all of whom are indulging in their passion for superbikes. These high net worth professionals roughly form as much as half the superbike buyers. The rest, aged between 21 and 35, are split between those who buy superbikes as a status symbol and some who look for performance. “A person may have a Mercedes, but he likes to go for a ride on a superbike with his girlfriend,” said Roy Kurian, national business head, India Yamaha Motor. The company sells FZ1, R1, MT-01 and V-Max superbikes priced at Rs 8.5-20 lakh. “This segment doesn’t require promotion. These customers know more about the bikes than the makers,” added Kurian.

Improving road infrastructure in and around big cities is driving bike makers to introduce new superbike models. “Global auto majors are recognising that India is evolving as the next big destination for the super-premium segment,” said Kapil Arora, partner (automotive), Ernst & Young.

Ducati and Harley Davidson set shop in India to sell their imported superbikes costing between Rs 7 lakh and Rs 42 lakh, while BMW Motorcycles will hit the Indian roads later this year. “Demand for superbikes will continue to be driven from big cities which have good roads” said Abdul Majeed, auto practice leader, PwC.

Superbike demand took off after Suzuki Motorcycle India launched the Hayabusa in 2007. The firm also sells Gixxer and Bandit 1250S priced at Rs 8.5 lakh and Rs 12.5 lakh.

Superbike makers also seem to be attacking the premium bike segment between 150 cc and 250 cc at price points of Rs 1 lakh to Rs 2.5 lakh to provide a feel of the bigger superbikes in similar looking but underpowered models. Yamaha, which launched an India-specific R15 model (Rs 103,000) in 2008 based on its global R1 bestseller, has seen huge success with the bike. “Initially, the demand for R15 was for 2,000 units, which has gone up to 4,000 units a month,” said Kurian.

It’s the Right time to buy cars, bikes

Car and two-wheeler manufacturers have heaved a sigh of relief after Finance Minister Pranab Mukherjee proposed to maintain the excise duty at present levels while inviting companies to step up investments in the sector.

The Indian automotive market, the second-fastest growing in the world, recorded a 31 per cent jump in sales (14.82 million units) last year, leading market watchers to believe that excise duty could be restored to its earlier levels.

Excise duty on compact and large cars, utility vehicles, two-wheelers and CVs was raised by two per cent last year following robust growth in automotive sales in the previous year.

Keeping in mind the high base of last year, the Society of Indian Automobile Manufacturers expects sales to grow 15 per cent to more than 17 million units.

Maruti Suzuki Chairman R C Bhargava said, “It’s definitely a positive move by the finance minister to keep the excise duty unchanged. A rate increase, coupled with steeper interest rates and high inflation, would have hurt demand as there would have been far less disposable income in buyers’ hands.”

Mukherjee, in his speech said, he had chosen not to raise the excise duty as this would mean improved business margins resulting into better investment rates and also because of the upcoming goods and services tax.

The Union Budget has also brought relief to manufacturers of hybrid and electric vehicles through a cut in the Customs duty. Batteries imported by electric vehicle manufacturers for the replacement market will now be exempted from the basic Customs duty and a four per cent concessional rate of central excise duty will be charged.

Moreover, specified parts of hybrid vehicles are now exempted from the basic Customs duty and special countervailing duty. In addition, a concessional rate of five per cent excise duty is being prescribed to incentivise their domestic production.

Further, a National Mission for Hybrid and Electric Vehicles will be launched to encourage manufacturing and selling of the alternative fuel-based vehicles.