Bajaj Auto rolls out refreshed 3-wheelers , existing models to be phased out

Pune, June 14, 2013: Refreshing its passenger three-wheeler platform for the first time in the last 40 years, Bajaj Auto (BAL), the country’s largest three-wheeler maker, has launched a new compact series of three-wheelers in petrol, CNG and LPG variants. Priced in the Rs 1.03 lakh-Rs 1.15 lakh range (excluding octrio and other taxes), the new compact series will come at a premium of nearly Rs 1,500-Rs 3,000 over Bajaj’s existing three-wheeler models. The company plans to roll out seven variants on the refreshed platform and a diesel version is also under development currently. The diesel variant is expected to be rolled out within 3-6 months.

Rajiv Bajaj, managing director, BAL, said that “starting with the domestic market, we plan to gradually phase out our entire existing range of three-wheelers with the upgraded models. Considering the fact that the three-wheelers will continue to be the most affordable form of last-mile transportation, we had to ensure that we not only refresh our existing models but also provide multiple advancements in terms of technology and new features to our customers. It is fatal to increase the consumer price of a product upgrade by more than 5 percent. After keeping all such factors in mind and calculating our 20 percent EBIDTA margins (earnings before interest, tax, depreciation and amortisation), we have priced the new range slightly above the existing models.”



Tech plays its role

Besides the cosmetic changes, the upgrades include tech-advancements such as DTS-i engine (digital twin spark ignition – first introduced by Bajaj Auto in its Pulsar range of motorcycles in 2003), 10-15 percent improved fuel efficiency, new reinforced chassis leading to improved reliability, lesser number of components used, lower maintenance costs and ergonomically designed shift levers and pedals. However, the refreshed models are nearly 20kg heavier than their existing counterparts. “The maintenance cost goes down substantially as we have shifted the oil change requirements to 10,000km which is what you will find in passenger cars. Conventionally, the three-wheelers require an oil change every 5,000km. In the refreshed models, the frequency of changing the oil filters is reduced. All these improvements enable a saving of around Rs 20,000 per annum for our customers,” explained RC Maheshwari, president – commercial vehicles, BAL.

Upcoming models

Throwing light upon his future plans for the three-wheeler market, Bajaj said that “we are working on new models and you will see more models coming out of new platforms. The Maxima will be a large-sized three-wheeler while the Optima will be the medium-sized three-wheeled vehicle. We are looking at introducing them with the diesel variant first, followed by the petrol and the CNG variants.” BAL currently rolls out around 2,000-2,500 units of the large-sized three-wheeler called Mega, per month, which is based on an old platform.

With the upcoming Maxima and Optima range of bigger three-wheelers, BAL will directly compete with Piaggio Vehicles India, which is reportedly stronger in the large-sized three-wheeler segment, selling primarily diesel-powered vehicles currently. Going forward, Bajaj Auto will have three basic engine options – the RE 145 (145cc, 2-stroke, petrol engine), RE 205 (200cc, 4-stroke, petrol engine) and the RE 445 (445cc, diesel engine) which will power the three-wheeler portfolio. According to company officials, BAL commands around 85 percent market share in the small sized three-wheeler category (including diesel and petrol).

The Pune-based firm sold around 452,000 three-wheelers during 2012-13, of which nearly 226,000 units were sold in the domestic market. The company is currently rolling out 40,000 three-wheelers per month against its total production capacity of 50,000 units per month. According to Maheshwari, nearly 20 percent of total sales result from new permits while remaining units are sold in the replacement market.

Exports

Disclosing the three-wheeler-specific export numbers, Rajiv Bajaj said that “we are exporting to some of the emerging markets such as around 7,000 units to Sri Lanka, 5,000 units to Egypt, 4,500-5,000 units to Nigeria and 3,000 units to Peru.” Talking about the emission norms, he highlighted that three-wheelers are one of the greenest modes of public transport. “A three-wheeler generates hardly 90g of CO2 per kilomertre run while a luxury car generates up to 250-300g of CO2 per kilometre. Interestingly, 87 percent of all three-wheelers in Sri Lanka are used for private transportation,” added Bajaj on a lighter note.

AMIT PANDAY

Photograph: Rajiv Bajaj and R C Maheshwari at the launch of the RE Compact three-wheeler.