The Hindu Business Line : TVS Motor plans launch of 100cc-plus scooter next fiscal

“This is a busy year for us. We will launch the scooter during the next fiscal,” the TVS Motor Company President, Mr K.N. Radhakrishnan, told Business Line.

Apart from opening a factory in Indonesia and one in India (Rajasthan), TVS has lined up launches of a motorcycle in the executive as well as in the premium segments during the current fiscal.

TVS wants to launch a scooter as it believes that the segment has not been tapped fully, apart from the fact that the market has been stagnant for some time now. There are only two other major players in the segment — Honda and Kinetic Motors. This will be the second time TVS will be entering this category. Its earlier foray had to be abandoned because it could not notch up good numbers.

Sources say TVS wants to enter the scooter segment because it wants to widen its customer base. The 90cc TVS Scooty has always been associated with women and the 100cc plus scooter could bring in male customers into the fold. The scooter segment constitutes 10 per cent of the two-wheeler market. Its size in volume terms is around 5-6 lakh units per month. TVS itself sells between 22,000 units and 25,000 units of Scooty every month.

New bike

Earlier, launching TVS’ new motorbike, Apache RTR 160 priced at Rs 57,000 ex-showroom, Mr Radhakrishnan said the new product has been positioned as a premier street bike. TVS expects to increase its market share in the segment to 25 per cent from 15 per cent currently after the launch.“We expect the second quarter to be better than the first after the launch of Apache RTR,” he said. The total sales of motorcycles in this segment are around 65,000 units annually.

Motor cycles sale

TVS sold a total of about 9 lakh motor cycles during 2006-07 and expects to cross the one-million mark during the current fiscal. Its total market share in all segments is 13 per cent and is the third largest two-wheeler company in the domestic market. TVS expects to sell 1.7 million two- wheelers during the current fiscal, posting a growth of about 13 per cent.

Mr Radhakrishnan said one of the reasons for poor sales of two-wheelers during the first quarter was not necessarily high interest rates but because of the reluctance of finance companies to fund all the customers. “The funding options have nearly dried up because finance companies have tightened financing norms,” he pointed out. “We expect the market to remain negative at least for another six months,” he said.

However, TVS expects better sales from the next quarter itself because of the launch of new bikes. It has also been able to resolve the issue of inventory among its dealers, Mr Radhakrishnan said. “We carried out some corrections on the stores with our dealers last quarter and that is behind us now,” he said.

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