'Going forward, we will have 90 percent of our India portfolio imported as CKD units while 10 percent will be CBU.'
The cruiser segment is the oldest segment (among premium motorcycles) that existed in India. What has happened is that few manufacturers stepped into India and brought those bikes because those are the only models that they made. So customers had no option but to hop on to those motorcycles and hence that segment grew.
Vimal Sumbly, MD, Triumph Motorcycles India speaks to Amit Panday on the five pillars of the brand’s India growth gameplan, which includes its flexible product localization strategy, big bike financing, foray into the second hand motorcycle market and other critical areas. Excerpts:
How do you assess the midsized naked performance motorcycle segment in India? How is the new Street Triple S different from the Street Triple sold earlier and what are your expectations from the new model?
Naked-sports is a growing segment in the domestic big bike market. Earlier the customers did not have many choices in the market. However, this has changed now, and this is the reason why this segment is becoming competitive.
Performance is one of the key criteria for the customers of this segment and we wanted to bring out that performance criteria for our customers.
The best part of this new product is that is has a combination of two factors – it now comes with a larger displacement and it delivers a substantial improvement of 41 percent in its peak power output. It is also two kgs lighter in weight than the earlier version. Also it is the first time that it is coming with many rider-focused technologies such as ride-by-wire, ABS, traction control, riding modes, LED headlamps and others.
In India typically in the premium motorcycle segment, customers take test rides, make up their minds and then check for financing schemes and then make the purchase decision. So it takes an average of 25-30 days time from the product launch when customers start buying the new model(s).
However, what we are seeing in the Street Triple S’ case for the first time is that the customers are not even waiting for the test rides. In Pune alone, five customers booked the bike without even test riding the same and before the product was launched.
So what could be the possible reasons behind your customers’ enthusiasm for the all-new Street Triple S?
I think this is because of the motorcycle’s historic background globally (and in India) and also because it is dubbed to be the finest model in its segment today. The third reason could be, as you know, we have tied up with Moto GP for supplying them with our three-cylinder engines, the engine powering this model is on the same platform and the customers of this bike are aware of this.
These factors, I think, have contributed into the quick decision making among the customers. We have received bookings for the Street Triple S in India almost two-three months in advance when we weren’t even accepting them. To me, this clearly defines the passion for the brand in India.
In the first 10 days of the launch of the Street Triple S we had delivered 25 units. We had bookings for another batch of 25 units to be delivered in July so 50 units are already sold (in a month of its launch).
We are aiming to sell around 200-250 units of this model in the first year of its launch in India. I think we are on track to achieve the same.
Who are the ideal customers for the midsize naked sports / street motorcycles in India?
A lot of youngsters want to ride the naked sports bikes. I see lot of riders now want to upgrade from typically 150cc, 200cc, 350cc to bikes with higher engine displacements. There is a patch of 600cc-700cc wherein the naked sports category is not that strong, and there are not many options as well. The Street Triple S (765cc) is the first product in the 700cc-800cc in its category and therefore I see traction.
The Street Triple S is available across all our dealerships and the model can be financed as well.
India is a market where the consumer is educated and he is absolutely tracking the global developments and product launches. So I believe that if you have to successful in India then you have to have the latest products and technologies in India.
The midsize naked street motorcycle segment will continue to grow in India. It will become more competitive as more products are launched in the market. I think there was a gap between 600cc – 800cc with lack of options. That is getting addressed with new options in the market and this segment will grow. I think no two rivals will eat into each other’s demand in this segment because this space in itself is growing. We have taken a lead by bringing the best bike in the segment to this market.
What is the product localization strategy as Triumph Motorcycles India is working to localize 90 percent of its portfolio soon?
If you look at our strategy in FY2014-15, we had 50 percent CKDs and 50 percent CBUs, which included Thunderbird Storm, Rocket III, Tiger Xplorer XC and others.
We follow June – July as our financial year format. So if I consider the period June 2016 to June 2017, we have 80 percent models via the FTA (with Thailand) and 20 percent CKD in India (at Manesar plant). For example the Classic and adventure bikes, which earlier were under the CKD route, came under the FTA route.
Therefore, our portfolio in India has now become 80 percent FTA and 20 percent CKD.
That strategy is now changing because when you are bringing the bikes through FTA, the objective is to bring the same bike with latest technologies as it is launched elsewhere in the world.
So going forward we will shift back to the CKD and have 90 percent of our India portfolio imported via CKD and 10 percent is going to be the CBU. The locally assembled models do not have any local content.
This gives us the benefits around low taxation, low cost of operations, flexibility of manufacturing, and also it gives us a long term commitment of the brand in India.
How do you view the cruiser motorcycle segment in India?
I would say the cruiser segment is the oldest segment (among premium motorcycles) that existed in India. What has happened is that few manufacturers stepped into India and brought those bikes because those are the only models that they made. So the customers had no option but to hop on to those motorcycles and hence that segment grew.
Now just like how we have different eating and dressing habits, typically riding habits are different for different riders. What is now happening is that people are buying what is fit for them and not what somebody tells them to buy.
At Triumph Motorcycles, our strategy was very clear. We wanted to cater to five different segments of motorcycles – classic, cruisers, roadsters, super sports and adventure. So for us the benefit is that people are buying from all these given genres of motorcycles.
Are you gunning for the cruiser segment aggressively because that’s one sleepy segment, which does not witness regular updates in the market? Should we expect new or updated models in your cruiser category later this year?
I would say there would be lot of excitement across the segments this year. We would look at the cruiser segment too but honestly the focus is across the five categories. It is so because all five categories will move forward.
We are a product driven brand and there is a lot of focus on the rider specific technologies. You will see best of the available technologies on Triumph motorcycles. Today 100 percent of my portfolio offers ABS.
How do you look at the merchandise vertical? Have you tied up with financial institutions for financing Triumph motorcycles?
Yes, we are looking at Triumph merchandise and also we are bringing financing options for our customers. We have tied up with HDFC Bank for seven-year finance, which for the first time is available on buying a motorcycle. Until now the seven-year financing schemes were available only for passenger cars. Through these customer friendly financing schemes we are making our motorcycles more affordable.
We are also venturing into second-hand two-wheeler finance and have tied up with a company called Wheels EMI. The pilot project will run in Pune. So we are doing multiple things to drive growth.
Our growth strategy is based on five pillars – brand and technology, dealership and aftersales network, local assembly in India, provide training to riders (Triumph Tiger Training Academy and California Superbike School) and affordability of products (through finance schemes).
We are very confident that these steps will help us achieve our ambition, which is to become the fastest growing premium motorcycle brand in India. We are close to the top spot (in big bike segment) and we want to be there in near future.
We are working to bring curated rides, which are called as explore India on two wheels. For example, we just did the Himalaya Rides where we got 10 customers riding together in the Himalayan trails. Similarly, we plan a coffee and spice ride in the south. I believe that these rides will bring the customers together.
I also strongly believe that the rides conducted on the weekends through our dealerships are a medium to bond and network together.
(This interview was first published in the July 15, 2017 print edition of Autocar Professional)
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