Motofumi Shitara: ‘Yamaha will be able to double its market share by 2025’
Yamaha Chairman says the PLI scheme will prove to be beneficial for the auto industry by bringing down the cost of production but also controlling the risk of investing in future tech.
Motofumi Shitara, Chairman, Yamaha Motor India Group, tells why he is confident that Yamaha is on the right track in India and how customers now relate a lot more strongly to the brand. The recent motorcycle and scooter launches will take the growth story forward.
Could you explain the significance of Yamaha’s recent motorcycle and scooter launch?
This launch holds great significance for all of us as it further reiterates our commitment towards the Indian market.
Since the launch of ‘The Call of the Blue’ brand campaign in 2018, our consistent effort has been to establish a strong brand presence in India through our 125cc and 150cc scooters as well as the 150cc and 250cc motorcycles with a strategically planned product portfolio, offering global excitement of racing and motorcycling culture in India. The launch of R15V4 and R15M along with Aerox 155 is further going to rev up the excitement quotient among our customers and elevate their passion of riding with fun and joy.
In one of our previous interviews, you had referred to a new scooter project for India. Could you give an update on this and why it is important?
The launch of the new Fascino 125 Fi Hybrid, Ray ZR 125 Fi Hybrid and now the Aerox 155 is part of our new scooter project and strategy to promote the sporty, stylish and technologically advanced scooter models in India.
Scooters account for almost 30 percent of the overall two-wheeler sales in India. The demand in the scooter segment has seen a continuous increase over the last 10 to 15 years. The scooter market in India doubled between 2009 and 2012, tripled by 2014 and continued its growth momentum till 2018.
Although overall growth fell in 2019, we are confident that the segment will witness a strong growth in future because of more young riders with aspirations of improved lifestyles. Now with the introduction of Aerox 155, we would focus on establishing a strong market for Yamaha sports maxi-scooter models in the 150 cc segment as well.
You had also said that a team in Japan would be working on a new EV platform for markets like India. Will this get a push forward from the Centre’s recently announced PLI scheme?
It is clearly evident that the PLI scheme is developed for battery electric vehicles and hydrogen fuel cell vehicles of all segments and on the component side, it is for a list of components in the more forward looking and cleaner technologies. More importantly, the Government wants to set up an ecosystem to encourage localisation and manufacturing.
So, it is very clear that it is promoting the use of future technologies to help create an efficient and modern value supply chain. This will prove to be beneficial for the auto industry by not only bringing down the cost of production but also controlling the risk of investing in these technologies.
Taking advantage of the PLI scheme is only possible when a manufacturer has products with green and advanced automotive or are committing additional investment and have higher incremental exports. Therefore, we are currently in the phase of reviewing this scheme to evaluate its pros and cons better and also to understand how beneficial it will prove to us in the long run.
Do you believe that the time has come for Yamaha to accelerate its electrification plan for India?
The Fascino 125 Fi Hybrid and the RayZR 125 Fi Hybrid mark Yamaha’s first step towards entering the EV space in the Indian market. The hybrid technology with electric power assist in our 125cc scooter range is just one of many technological advancements achieved in the field of electric mobility by Yamaha, which we have introduced in the Indian market. With time, we intend to introduce similar technological advancements, eventually entering the EV space.
While we welcome and appreciate the new EV policies being introduced by State governments to strengthen the demand for EVs, via attractive subsidy and incentive schemes, there are bigger challenges related to investments. We are contemplating on factors like pricing, performance, and infrastructure before we roll out any products for the Indian market — mainly since the success of EVs solely depends on the acceptance of customers at large. This is only possible with proper availability of infrastructure, charging stations, battery production and swapping infrastructure for electric vehicles.
Do you think that partnerships are also important for areas like batteries?
Partnerships with battery manufacturers will play a vital role in the success of this ambitious project. Not every OEM in India has the expertise or is well equipped to manufacture batteries on its own. As the demand and adoption of the electric vehicle market increases, the requirement for batteries will also increase proportionately.
To meet such high demand, partnership with local manufacturers and research on developing technologies that ensures longer battery life cycle and improves the efficiency of the battery as per the requirement of the OEM’s will be quite important.
We also must consider the fact that the battery being the core component will draw huge investments. So, it is important that we evaluate and understand whether an investment by an OEM will be viable in the long run or partnership with a battery manufacturer will prove to be beneficial.
Japan is accelerating plans for a new electric consortium with Yamaha, Honda and other players. What are your thoughts on this and do you see this model replicated for India too?
In my opinion, this consortium holds great significance as this kind of collaboration and effort is only going to accelerate this transition. The aim of this association is to promote the widespread use of light electric vehicles and contribute to a more sustainable lifecycle management of batteries used in the transport sector.
I believe that such collaborations on ensuring uniform technical specifications and standards for battery charging systems will help lead towards maximising the merits of electric power for customers on a global level. However, I cannot comment now whether the same model can be replicated in India as well.
Having been India Chairman for over three years now, do you believe Yamaha can grow faster from here?Yamaha may hold a 3.7 percent market share in the Indian two-wheeler industry but it enjoys a strong 20 percent market share in the premium motorcycles segment (149cc and 155cc), which has been our focus since 2018. We strongly believe that there is a huge opportunity for us in this segment as the customers are stepping up from the lower displacement bikes to higher models for more excitement.
The perception of customers is continuously changing — over the years we have noticed that they are now demanding high performance two-wheelers, representing their spirit of riding. On all these fronts, the newly launched YZF-R15 V4 and Aerox 155 maxi-sports scooter, which is a first of its kind in the Indian market, will prove to be dominant with many segment first features.
With a strong product portfolio that caters to the requirement of youth in India, I am confident that Yamaha will be able to double its market share by 2025. Yamaha’s current motorcycle line-up includes sporty commuters like the FZ FI, FZS FI, the new-retro FZ-X, the MT-15 streetfighter and the refined quarter-litre FZ 25 and FZS 25.
These models will continue to meet the aspirations of Indian youth, who are passionate about racing, touring and adventure riding. Furthermore, with the recently launched Hybrid version of the new Ray ZR 125 Fi and Fascino 125 Fi Street Rally 125 Fi, Yamaha will cater to customers who are looking for style factor, induced with adventure and fun while also being extremely efficient at daily commuting.
That is not all. Every Yamaha product in India today is built to global standards, with features and specs that are at par with Yamaha products in the global market. These unique set of features that truly distinguish Yamaha products from its competition are side stand engine cutoff switch, variable valve actuation (VVA), assist and slipper clutch (A&S), traction control system, quick shifter, bluetooth enabled connect X and Y-connect application, ABS, auto start & stop, hybrid power assist etc.
Are you pleased with the progress of the growth of brand Yamaha and your efforts on The Call of the Blue strategy?
I am quite convinced with the progress made in these years. Today, I can proudly say that 'The Call of the Blue' brand campaign has succeeded in conveying the brand's commitment to offer world class mobility options backed by exciting performance and style factors among the Indian customers. Now every customer in India can relate to the brand’s core competencies and its racing DNA.
We have witnessed a multifold increase in customer engagement both through our digital marketing initiatives as well as on-ground activities. The Call of the Blue has been very influential in driving our market strategy and going forward, we would like to expand the campaign in the other potential and untouched markets, thereby building a strong customer base in India.
What challenges and opportunities do you see for Yamaha in India after the pandemic?
Unlike last year, since the state governments have been directing lockdowns this year, the impact of the lockdown has been limited. As a result, companies have been able to plan and channel their economic activities better.
After facing the pandemic in 2020, we have been more alert and prepared to handle the current situation. What we learnt during that period was that we need to keep moving ahead with the spirit of challenge and keep the workforce motivated to achieve the business targets.
The one thing that Yamaha did immediately with the announcement of lockdown was to start planning the market approach post lockdown. The next thing we did is streamline our plans with our priorities - be it potential market, customers, production, and sales targets, to ensure we are two steps ahead in the overall rebound of the retail economy.
Finally, do you believe that the internal combustion engine will become irrelevant by the end of this decade allowing electric to take over?
I cannot comment about what will happen by the end of the decade but for now, I am quite sure, it is going to stay for the next couple of years. There is a lot of research happening in this area where the focus is to develop internal combustion engines which are environment-friendly and quite efficient.
Electric vehicles are the future but to replace internal combustion engines, they must become affordable and convenient for everyone. These include lower-cost batteries and reasonably priced EVs, a stable supply of raw materials to produce the huge number of lithium-ion batteries required, greater range, and more widely accessible and quicker charging infrastructure.
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