Made-in-India entry level Norton in the works, Motoroyale looks to raise Rs 100 crore

by Nilesh Wadhwa 29 Aug 2019


Motoroyale, the Kinetic Group’s multi-brand premium motorcycle division, is looking for speedier traction in the high-end motorcycle segment in India. Motoroyale, which currently markets 5 brands including MV Agusta, Norton, FB Mondial, SWM and Hyosung and 11 models in India, is betting big on iconic British manufacturer Norton Motorcycles.

In November 2017, Motoroyale entered into a 51:49 joint venture to assemble and market Norton bikes in India and ASEAN countries. While Norton is to provide the IP and design/engineering for current and future models to the joint venture, Motoroyale will offer localisation, homologation and manufacturing support.

As part of the partnership, the company has been working on a 650cc motorcycle which is expected to be launched by March 2020 and will see around 50 percent localisation. But that’s not all, says Ajinkya Firodia, Managing Director, Motoroyale Kinetic. “We will launch a new Norton motorcycle by March 2021, which will be a 100 percent made-in-India, for India and Asia, motorcycle. This new motorcycle will be designed keeping in mind the domestic market conditions but will sport the reliability and premiumness that Norton commands globally.”

As regards the level of investment the company will make in the Norton project, Firodia revealed that around Rs 25 crore has been invested by the Kinetic Group in this joint venture. “We are looking to raise around Rs 25 crore more for development for which we are targeting HNIs (high-net-worth individuals). And a further Rs 70-80 crore will be raised through private equity, which will go towards marketing, branding and production,” said Firodia. Interestingly, he added that the additional Rs 25 crore investment may even be made by the Kinetic Group, depending on the prospects of the deal with HNIs.

Speaking on the sales prospects of the entry-level, premium under-500cc Norton, Firodia said it could go as high as 30,000 units per annum. “For us, Norton has been a volume seller. We have already sold 600-700 Norton motorcycles, 800-900 Hyosungs and 200 SWMs in India,” disclosed Firodia.

“The premium bike industry or the above-350cc motorcycle market is estimated to be around 900,000 units in India. Of this, the super-premium (above Rs 300,000) bikes make up for around 15,000 units or so,” said Firodia.

Market sees shift towards premium motorcycles
A closer look at the two-wheeler sales trend in India reveals that the market seems to have shifted towards premium and higher-powered motorcycles. Royal Enfield, Bajaj Auto, TVS Motor Co and BMW Motorrad have products in the above-300cc segment and a growing number of bike aficionados are loosening their wallets on higher-powered bikes. This trend is not lost on some foreign players, giving them the confidence to think of an India market entry.

On July 25, 2019 MV Agusta announced a strategic tie-up with China’s Loncin Motor to develop 350-500cc bikes targeted at the high-growth market globally. Responding to a query on the impact of such a partnership, Firodia says, “We have a strong relationship with MV Agusta, and this development will translate to the entry-level MV Agusta motorcycle to Motoroyale showrooms in the country.”

BS VI may see global bike brands dropping products for India
The implementation of a stringent emission norm like BS VI could have some two-wheelers brands in a fix. The deadline for the upgrade to BS VI norms (Euro 6) for all vehicle segments (two- and three-wheelers, passenger vehicles and commercial vehicles) is March 31, 2019. In contrast, the European Union will adopt Euro 5 norms for motorcycles from January 2020. This would mean the products which at present are being sold by Kinetic Motoroyale will have to be upgraded with BS VI engines from April 2020.

“This is a very challenging situation for any brand, but we are already in talks with our OEM partners to upgrade their engines before the Euro 6 deadlines, and future-proof themselves too,” says an optimistic Firodia.

But with the volumes in India for premium motorcycles still being relatively small, it could be difficult for OEMs to launch BS VI-engine motorcycles before their European counterparts are upgraded. But with the domestic industry expecting things to improve soon, the situation is expected to only go north.

Motoroyale launches MV Agusta Turismo Veloce 800
Meanwhile, Motoroyale launched the sports tourer MV Agusta Turismo Veloce 800 today at Rs 18.99 lakh and inaugurated its second dealership in Mumbai. The new multi-brand dealership is the sixth showroom after Bangalore, Chennai, Hyderabad, Kochi and Thane.

Speaking at the launch, Firodia said: “MV Agusta is known for providing top quality and unique designs, while keeping the safety of the rider in mind. The Turismo Veloce 800 model combines MV’s racing DNA with the need to provide a comfortable and safe ride for long journeys. Aggressive and compact, yet comfortable and under control.”

What’s more the company will inaugurate two more dealerships – in Dehradun and Delhi – in India and establish its first international presence in Bhutan next month. This is part of the company’s aggressive plans to bring premium international brands to India. It may be recollected that Kinetic Motoroyale had targeted to have 12 dealerships in the country by end 2019. And scale it up to 45-dealerships soon after. What’s changed is the fact, that the ongoing slowdown in the auto retail has impacted the overall industry, and premium bikes have been no exception.

“Before we used to get a lot of enquiring and interests for potential Motoroyale dealers, but with the slowdown and the media coverage on many dealerships shutting shops, it is difficult to convince new partners to enter the business,” remarked Firodia.

Also read: Motoroyale launches MV Agusta F3 RC at Rs 22 lakh, only six for sale

Motoroyale launches MV Agusta F3 RC at Rs 22 lakh, only six for sale


 

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