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Bajaj gears up as Egypt beckons again

Murali Gopalan | Updated on May 22, 2014 Published on May 22, 2014

Bajaj’s motorcycles have been doing well in markets like Nigeria, Indonesia and Egypt.

The RE60 could make its way to the country if everything falls in place

When Egypt lifted its import ban on two and three-wheelers this week, Bajaj Auto had reason to celebrate. After all, this is its second most important market for three-wheelers after Sri Lanka with export numbers averaging nearly six thousand units each month.

The ban was enforced in mid-February and was expected to last a year. Since it did little to help anyone’s cause except the black market where vehicle prices went out of control, the government perhaps thought it best to revoke the ban.

Two-wheeler growth

While Bajaj Auto’s three-wheelers have been doing well in Egypt for a while now, its motorcycle business has been recording significant growth too. From 20,000 units in FY 2012, the despatches increased to 37,000 bikes during the next two fiscal years. For 2014-15, the company hopes to achieve at least 50,000 units in an export basket which largely comprises the Boxer accompanied by the Discover and Boxer.

This goes in line with what Managing Director, Rajiv Bajaj, recently told Business Line when he drove home the point that the company’s strategy went beyond just domestic market numbers. “Bajaj Auto is a global company whose motorcycles and three-wheelers are doing well in a host of countries,” he had said.

For instance, its bike share in Nigeria has gone up in the last year from 34 to 44 per cent while in Uganda this is now at 88 per cent, up from 81 per cent. Closer home, the company’s market share in Bangladesh has increased to 53 per cent (from 46 per cent) and Sri Lanka from 74 to 82 per cent. In Southeast Asia, the marketing alliance with Kawasaki has seen growth in Indonesia and the Philippines while its European ally, KTM, is drafting a different global play in Europe, the US, Japan and Australia.

There is no indication what the road ahead for Egypt will be like for Bajaj Auto’s motorcycles. Going by the growth seen over the last three years, it is likely that one lakh units per annum could be achieved during the course of this decade. Will this continue to be dominated by the Boxer? There is no telling if the Egyptian market will change in the coming years and whether more buyers will begin queuing up for top-end bikes like the Pulsar.

Future plans

It also remains to be seen if Bajaj Auto will launch the RE60 quadricycle in Egypt as part of its menu for mobility solutions beyond three-wheelers. Company sources believe the country may pan out to be a good market for the RE60. The key, though, is that the quadricycle class must be created in the regulatory framework of Egypt.

The product has still not been launched but, apart from India, Bajaj Auto is bullish about its prospects in markets such as Nigeria, Sri Lanka, Colombia and Indonesia. Since the core of the quadricycle is urban mobility, this becomes a common requirement across the world right from South America to Southeast Asia.

The RE60 has been positioned as an ideal solution to tackle the menace of congestion on roads. It is also expected to be the best bet for last-mile connectivity. The company has constantly maintained that the quadricycle fits the need for intra city transport as it is compact, light and cannot go beyond a certain speed. With a fuel efficiency of nearly 35 km/litre, it also ends up being an affordable mobility solution.

This is precisely why Bajaj Auto believes the quadricycle concept is as relevant in markets like Europe where people are getting older and need to move around comfortably. In addition, their disposable incomes become limited once they retire and need to rely on their savings. Will Egypt see the three-wheeler coexist with the RE60 before eventually making way for the latter? Market requirements and regulations will finally decide the way forward though this is still some years away.

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Published on May 22, 2014
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