The 110cc Hayate commuter bike has been good news for Suzuki Motorcycle India (SMI). The company's first entry-level mass segment motorcycle has been sellling well since its launch in May 2012. Thanks to burgeoning demand for the bike, SMI is now in the process of ramping up capacity. It is simultaneously strengthening its distribution network that, at 300 units across India, still chalks lesser numbers compared to the competition. The plan is to extend the penetration to 500 outlets next fiscal.

Similarly, the current production capacity of 450,000 units at the Gurgaon plant will be stepped upto 550,000 units per annum in FY’14 with the Hayate accounting for 60 percent of this increased capacity.

At present, this commuter bike accounts for around 25 percent of SMI's production with five models – the Hayate, GS150R, Slingshot plus motorcycles, and Access and Swish scooters – produced at the facility. The CBUs available from SMI include the Intruder, Bandit, GSX R1000 and Hayabusa bikes.

“Capacity expansion is currently underway and this will continue,” affirms Atul Gupta, vice-president, sales and marketing. He had earlier told Autocar Professional that the company is mulling a second manufacturing facility at Rohtak, also in Haryana, with an investment of Rs 500 crore as part of its expansion plan. To be spread across 50 acres, the plant will have a production capacity of 500,000 units per annum.

Many new models of both scooters and motorcycles are expected to be produced at the Rohtak plant that will enable SMI to reach a production capacity of a million units by 2015 when the new facility will go on stream. SMI has so far experienced limited growth in India compared to its Japanese counterpart Honda Motorcycle & Scooter India. The Hayate competes in the Hero Splendor and Honda Dream Yuga segment. At present, it sells around 10,000 units per month while sales numbers for the 125cc Access and Swish scooters are 25,000 and 5,000 units per month, respectively.

The way ahead

Going forward, the Hayate along with the scooter portfolio will play an important role in SMI’s growth gameplan in India. Both the Access and Swish have a waiting period of around six to nine months as the current production capacity at the Gurgaon plant is 30,000 units per month compared to the demand for 50,000 units, says Gupta. Undaunted by the growing popularity of the 109cc Honda Dream Yuga, he feels that the Hayate commands its own clientele and markets in a different space to the competition.

But with new models in both scooters and bikes in the pipeline in FY’14, Suzuki expects the year to be a better one. Despite the industry growing at around 3-4 percent, SMI is optimistic of garnering an additional five percent market share in both scooters and bikes. It claims it holds a market share of 20-21 percent in the scooter segment and three percent in motorcycles.

For SMI, a strengthened distribution network will be the key growth driver. At present, South India provides the maximum sales of 30 percent, the west and north chip in with 25 percent and the east brings 20 percent. SMI, which has sold 314,840 units between April-December 2012, expects to end the current fiscal with sales of 450,000 units. For 2013-14, the company forecasts an over 25 percent growth over the current fiscal. Meanwhile, SMI kicked off its first consignment of exports with 100 units of its GS 150R bike to Columbia as a testing exercise in that market during August-September 2012.

SHOBHA MATHUR