‘Suzuki’s focus will be on the niche segments in bikes in India’s A- and B-class cities.’
Atul Gupta, executive vice president, Suzuki Motorcycle India, speaks to Shobha Mathur on developing the second Gixxer sports bike for India, the company's growth strategy and realigning its scooter-bike sales.
Atul Gupta, executive vice president, Suzuki Motorcycle India, speaks to Shobha Mathur on developing the second Gixxer street sports bike for India, the company's growth strategy and on realigning its scooter-bike sales.
Who are the target customers for the just-launched Gixxer SF, the faired version of the Gixxer? How would this be different from the naked Gixxer sibling's target buyers?
The aspiration level of a young customer never stops. We cannot say that this is the ultimate (bike) for a customer in that category. What they always see is that there should be something better or something that suits his physique or style.
When we were conducting research for the Gixxer earlier, we found two types of buyers in the street sport bike category – one for the naked bike and the other for a fairing-equipped bike which looks sportier. It was then that we decided that there should be two variants – the Gixxer SF is an extension of that research. This bike gives a little more power and a little more speed but the difference between the the Gixxer and the Gixxer SF as regards a customer’s profile is not much.
While the Gixxer has notched success in the 150cc segment, what kind of further traction are you looking at in this segment with the new Gixxer SF?
Our production capacity is 9,000-10,000 bikes of both the Gixxers. We will see how the response of the market is and can always manoeuvre between both.
Is there a waiting period for the Gixxer?
As of now, in certain parts (of India) we have a waiting period of 7 days. In some regions, it is three weeks.
Going forward, is 150cc a focus segment for you? Which new models will you look to introduce?
Yes, we will focus on the niche segment which includes the 150cc and above motorcycle segment. It will be difficult to comment as we have launched the Gixxer and the Gixxer SF and it is too early for us as we need to first consolidate the Gixxer portfolio for the next year or so before we think of how to take it forward.
Suzuki was also planning to expand its product portfolio in the commuter segment? Your comments.
We have the Hayate in the commuter bike segment. What we have realized is that this segment is too complicated in terms of the bottomline of the company. You may get the topline but ultimately you cannot do without the bottomline because there are established players and the rural market where that bike really gets sold is so impacted by finance conditions and agricultural incomes that for a player like us it is not easy to penetrate fast.
That is why we have decided that we will be there as a player but our focus will be on the niche segment in motorcycles in the A- and B-class cities in India. The commuter segment is extremely competitive, so for us to penetrate and reach a certain level with our technology and expertise it is better to get into the mid-segment without exiting the mass segment.
After the Inazuma's exit, Suzuki Motorcycle India has no model in the 250cc segment. Are you not considering that space anymore?
Our attention will be on 150cc and above in the niche segment. So as we consolidate our base on the Gixxer series for the next 12 months, we will only focus on this particular series. We have a production capacity of 100,000 to 110,000 units so we will see how that percentage has to be matched. As of now we will be in the 100,000 to 110,000 range, both Gixxer bikes put together.
On the distributorship and network front as well as products, which are your immediate priorities and how many are you looking at for CY2015 and CY2016?
We had 600 distribution points at the time of the Gixxer launch (in August 2014) and now are at 800. We will take it up to 1500 by March 2016. We launched two new products last year – the Gixxer and the Lets scooter – and the refreshed Swish and Access scooters. We will just follow what we have done in 2014-15 with a couple of new products and refresh the old ones in both scooters and bikes this year as well. Scooters will come in the family segment and bikes in the niche segment.
How is Suzuki juggling between its scooter and motorcycle portfolio?
Our percentage of scooters before we launched the Gixxer was 90 percent scooters with 10 percent for motorcycles. With the Gixxer six months on, we have reached scooters at 80 percent and motorcycles at 20 percent. The market is 70 percent motorcycles and 30 percent scooters so if we have to realign ourselves, we have to be 70 percent motorcycles and 30 percent scooters but that is not possible within a short span.
What we are looking at is that with the Gixxer series we should get to 60:40 – 60 percent scooters and 40 percent motorcycles to reach a level of 500,000 units. That is the first stage.
Any targets in terms of market share?
Frankly, we are not looking at any market share because at this volume where we are closer to 400,000 units and looking at 500,000. I don’t think market share has any significance in terms of the overall industry.
Our market share in scooters as of now is 11 percent and we sell 250,000 scooters and 100,000 motorcycles. When we go up to 60:40, scooters will go up to 300,000 units and motorcycles should go to 150,000 by the end of this fiscal (2015-16). Our distribution should be in line with our product strategy and with a focus on exports.
How important a role will exports play in the company’s overall game-plan?
We have started exports and are at present shipping 30,000 units annually. We will do 40,000 units during this fiscal. Last year we exported 10,000 units to Latin America, Middle East and African countries. We will maintain 10 percent exports this year as well.
Are you looking to increase production capacity?
Next year we are aiming at 500,000 units sales while our capacity is 540,000. If we are successful in doing so, in the first six months of this fiscal, and depending on how the market performs as currently the industry is not doing as well as expected, the existing space can take production up to another 20 percent from the existing 540,000 capacity.
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