Jawa recasts business plan to deliver on its brand promise

by Shahkar Abidi 16 Nov 2019

Classic Legends, the manufacturer of the reborn and iconic Jawa brand of motorcycles, claims that it recast its business plan in India to meet the challenges arising out of production, supply chain and dealership issues, which have arisen in the recent past.

The company is said to be facing heat from agitated customers for delays in deliveries of its two motorcycles the 293cc, liquid-cooled, single-cylinder, DOHC engine Jawa and Jawa Forty Two – which it first revealed, along with the just-launched Perak, exactly a year ago, on November 15, 2018. The Jawas are manufactured at the Mahindra Two Wheelers' plant in Pithampur, Madhya Pradesh, where, according to an industry source, 200 motorcycles were being produced per shift.

Classic Legends has been set up by Anand Mahindra, chairman, Mahindra Group; Anupam Thareja, managing partner, Phi Capital; and Boman Irani, CMD, Rustomjee Group, with Mahindra holding a 60 percent stake in the venture.

The first made-in-Pithampur Jawa was delivered on March 30, 2019, four-and-a-half months after the product reveal and catering first to the large number of online bookings Classic Legends had received following the massive response to the launch of the blast-from-the-past brand. Bookings were stopped on Christmas day as the two Jawa models – Jawa and Forty Two – were sold out till September 2019.

On the retail front, as of March 2019, as part of an aggressive sales and service network strategy, the company had in place 85 Jawa Motorcycles dealerships across 77 cities in India, very creditable for an entrant into India's motorcycle marketplace. But things did not pan out as well as the manufacturer would have liked.

Jawa production being revved up
According to Anupam Thareja, founder, Classic Legends, the company is now “reasonably” comfortable with the production as well as suppliers who are now better aligned with it, which has consequently helped in improving its line  deliveries. “The deliveries now are 6-7 months from what we started at 10-11 months,” said Thareja, on the sidelines of the launch of its third Jawa – the Perak – in Mumbai on November 15, 2019.

The Perak, which is powered by a 334cc, single-cylinder, liquid-cooled, DOHC engine that develops 30hp and 31Nm of torque, costs Rs 195,000 (ex-showroom, Delhi). It was first showcased a year ago with a Rs 189,000 price-tag; the near-Rs 6,000 increase is likely a result of the engine being upgraded to meet the new BS VI emission norms.

Jawa will begin to accept bookings for the Perak on January 1, 2020. However, the bike maker has revealed that deliveries for the motorcycle will begin much later, on April 2, 2020. This is quite a significant waiting period – just like with the last two Jawa models. The company says this is essentially due to non-availability of BS VI fuel at present; using BS IV-grade petrol is likely to have an impact on the Perak. 

The company management has refused to reveal as to exactly how many Jawas have been delivered thus far or how much of production has been revamped to meet demand. Sources had earlier told Autocar Professional that the company has targeted 90,000 units for the first year of its operations.

Elaborating further, Thareja said the company management had not anticipated such robust demand for the bikes which led to deliveries getting delayed. “The demand we thought that will happen was at a conservative estimate. We should have prepared for more,” admitted Thareja. For example, the just-launched Perak will be the first bike in the company portfolio to have a dual-channel ABS, which was missing in the earlier two Jawas. The company now plans to increase the number of dealerships in the country.

Ashish Singh Joshi, CEO, Classic Legends, claims that every single customer who was committed delivery by a specific date in October 2019 was delivered a Jawa of his/her choice. Also, the company tried to build on its commitment by offering to pay Rs 500 per day as compensation if the delivery is not made as scheduled. The company has since paid three customers for delayed deliveries.

It is understood that one of the major issues following the launch of the Jawa bikes was of inadequate supplies. Some dealerships had to suffice with just two units, which drastically impacted the consumer experience, what with aficonados wanting to get their hands on a Jawa as soon as possible. Now, a wiser Classic Legends plans to correct things by adding  more dealerships across the country. “There are a number of areas that the company has touched. Currently, they (Jawa bikes) are available in 85 cities. In certain cities, people are travelling 200-300km to get to a dealership and the company wants to correct this. That is going to be a focus area,” pointed out Thareja.

From the looks of it, the company now aims to ensure that there is no mismatch between demand and supply of Jawa motorcycles. In a competitive two-wheeler marketplace, and particularly in the surging midsize bike segment, that's just what the competition would like. And brand Jawa now is keen to deliver on its promise and perception it unveiled last November.