Bajaj Auto has joined hands with Triumph Motorcycles of the UK. This non-equity partnership will focus on making mid-capacity motorcycles for emerging markets.

Triumph has been assembling 500cc plus motorcycles at its Manesar facility in Haryana. With Bajaj, it can look at the possibility of entering segments in the 300cc space where economies of scale can be achieved from the latter’s facility in Chakan near Pune.

This is already a manufacturing powerhouse for KTM’s Duke motorcycle range which are shipped out to the US, Europe, Australia and the Asean region. In the coming months, Swedish brand Husqvarna will also join the Chakan assembly line which will boost volumes to over 250,000 units annually. It is very likely that Triumph’s motorcycles will follow the same route where an array of mid-capacity models can be produced here and exported to emerging markets in the Asia-Pacific region. The cost-efficiencies at Chakan can also help Triumph ship out bikes to developed countries in the West.

From Bajaj’s point of view, the partnership will give it access to technology as well as a larger customer base both in India and worldwide. Though this alliance does not involve any equity at this point in time, there is no telling what is in store as the partners work towards a robust business plan. After all, Bajaj began with a 14 per cent stake in KTM a decade ago, which has since grown to 48 per cent and matured into a deep relationship.

When KTM acquired Husqvarna from BMW four years ago, it was only a matter of time before production of select models would shift to Chakan. With Triumph now added to the growing family, it will be interesting to see how Bajaj balances its allies while staying true to its focus of being a global motorcycle player. The coming together with Triumph also puts at rest the speculation swirling around a possible acquisition of Ducati which was put up for sale by the Volkswagen group. When Managing Director Rajiv Bajaj said at the company’s annual general meeting in Pune last month that a “very promising alliance” was imminent, people assumed that the reference was to Ducati.

After all, this Italian brand was up for sale at an asking price of €1.5 billionand global media reports suggested that Bajaj Auto and Harley Davidson were among the contenders to snap it up. It now looks as if this is not going to happen in a hurry, especially with the Ducati sale now put on hold since there is no compelling reason for a rejuvenated VW group to make money now.

Triumph has been looking to establish its brand in India and the market is more than aware of its motorcycle range which includes the Tiger 800, Bonneville and the Thunderbird family. It had contemplated a full-fledged manufacturing facility in Karnataka but eventually opted to continue assembling bikes at its Haryana plant.

The partnership with Bajaj could see some big numbers emerge from the Chakan plant in the coming years.

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