Benelli Planning Entry Into 135-200 CC Bike Segment in India Post 2019
Benelli had stopped selling bikes in India in May this year after parting ways with its Pune-based former partner DSK Motowheels, which ran into financial trouble.
Italian premium two-wheeler maker Benelli, which is set to resume sales in India in October, will look to enter smaller 135-200 cc bike segment after 2019 to have a wider market presence, a senior company official said. The company, which has roped in a new partner -- Mahavir Group -- for its fresh journey in India, will initially focus on 300-600 cc motorcycles through 12 models to be launched by the end of 2019.
Benelli had stopped selling bikes in India in May this year after parting ways with its Pune-based former partner DSK Motowheels, which ran into financial trouble. To begin with, the Mahavir Group is setting up an assembly unit in Hyderabad to serve the demand for Benelli bikes in India through a licensing agreement. The two partners have also agreed to form a joint venture to set up a manufacturing plant in Telangana for which the Italian firm has signed a memorandum of understanding with the state government.
"We took a fast decision of not to be out of the market for a long time after the problem came up. The first thing to do was revise from among all the relationships we had built," Benelli Chief Marketing Officer Dante Bustos told PTI. By October this year, Benelli will launch three 300cc motorcycles which will be assembled at the Hyderabad facility. "Our focus in India in the next two years will be in the 300-600 cc segment. We will launch 12 models by the end of 2019," he added.
Benelli's immediate focus will be to put its business back on track, ensuring availability of spare parts and addressing customer concerns quickly. When asked about the long-term strategy, Bustos said:"Also now we are working on single cylinder strategy, for motorcycles with displacements of 135-200 cc, which is also a new technology. We plan to come to India with these, we cannot exactly say when but it won't be before 2019."
He further said the potential in India is enormous as it is the biggest two-wheeler market in the world and Benelli's aim would be to have cost-effective premium bikes manufactured in the country. The planned JV is intended to meet that ambition and currently a feasibility study is on to finalise details such as capacity of the proposed plant and shareholding between the two partners, he said.
Although Benelli traditionally has 80 per cent of components produced in-house, Bustos said in India the company is looking to tap local parts suppliers and integrate them in its supply chain. Benelli has set a target of selling around 3,000 units a year and eventually have a market share of around 25-30 per cent in the 300-500 cc segment in about three years. It plans to have around 55-60 touch points spread across India in the next two years, up from 18 dealerships at present.