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With Bajaj in sidecar, Triumph to jointly roll out bikes

By Shally Seth Mohile
January 25, 2020 10:51 IST

It's the first time in its 178-year-old history that the iconic British motorcycle firm owned by the Bloor family has got into an alliance.

Three years after announcement, the two companies formally signed on the dotted lines on Friday for a long-term partnership, which aims to achieve global scale in a segment in which Royal Enfield has head-start.

IMAGE: Rajiv Bajaj, MD, Bajaj Auto, and Nick Bloor, CEO, Triumph Motorcycles, at an event in Pune to announce that the two companies will roll out jointly developed motorcycles from 2022, on January 24, 2020. Photograph: ANI Photo.

Triumph Motorcycles and Bajaj Auto will start rolling out the jointly developed motorcycles -- to be priced below Rs 2 lakh -- from Bajaj’s Chakan facility from 2022.

The roll-out is part of the non-equity alliance the companies have forged to primarily address the so-called middle weight segment of the market in India and globally. It's the first time in its 178-year-old history that the iconic British motorcycle firm owned by the Bloor family has got into an alliance.

Three years after announcement, the two companies formally signed on the dotted lines on Friday for a long-term partnership, which aims to achieve global scale in a segment in which Royal Enfield has head-start.

 

Currently, Eicher Motors’ motorcycle-making arm has a near monopoly in the segment.  3Emboldened by its success, two-wheeler makers in India and globally are looking to tap one of the fastest-growing  segment.

The move, Triumph Chief Executive Officer Nick Bloor said, would create new entry point for the Triumph range around the world, and ensure it can compete in important large segments of the global motorcycle market, and attract new customers to the brand.

“This is an important partnership for Triumph and I am delighted that it has formally commenced,” Bloor said at a press meet at Bajaj Auto’s headquarters in Akurdi near Pune. “It will take the brand into crucial new territories and is a crucial step in its ambitions to expand globally, particularly in the fast-growing markets of South East Asia, but also driving growth in more mature territories like Europe.”

Rajiv Bajaj, managing director of Bajaj Auto, said there would be a huge appetite in India and other emerging markets for these new products. “We look forward to working alongside such a famous motorcycle company and to leveraging each others' strengths and expertise to make the relationship a success for everyone,” Bajaj said.

The first Made-in-India Triumph model from the new venture is likely to be a 400cc motorcycle, which will be rolled out of Bajaj’s Chakan facility.

The strategic partnership will make Bajaj one of Triumph’s key distribution partners in crucial new markets for the brand around the globe. Going ahead, Bajaj will take over Triumph’s India distribution activities. 

In their other key overseas markets, where Triumph is not present, Bajaj will represent it and offer the new mid-capacity bikes as part of the full Triumph line-up. And in markets where Triumph is present, the motorcycles developed together from this partnership will join the current Triumph product portfolio and be distributed by the Triumph-led dealer network worldwide. 

The partnership will help the two companies crack into the middleweight segment of the motorcycle market, which is led by Royal Enfield motorcycles. Royal Enfield makes 350cc and 500cc bikes and one 535cc bike. Bajaj makes one in that category -- the 375cc Dominar -- and Triumph one. 

Through this deal, the duo is looking to hit the sweet spot of cost-competitiveness and pricing power. While Bajaj boasts a competitive cost structure through its economies of scale, Triumph, owing to its premium brand positioning, will have the pricing power.

Bajaj clarified that while the companies would collaborate in various ways, they would retain individual brand identity. Therefore, a Triumph model will never have a Bajaj branding and vice-versa. The duo will also stay clear of platform sharing.

“We candidly acknowledge that when we go beyond the value-for- money space into the high-end space, where a brand's heritage and lineage becomes very important. We have no intention to spawn a motorcycle from the Triumph platform for Bajaj. Every brand has a place in the mind of the customer. It will do well if it stays in that space,” Bajaj said.

This will be the second alliance for Bajaj with a global bike maker. It owns 48 per cent in Austrian bike maker KTM. The partnership has paid huge dividends to the partners with brisk volumes, market access, and cost benefits in its 12-year tenure.

Shally Seth Mohile in Pune
Source: source
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