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Yamaha working on new scooter project for India

Murali Gopalan | Updated on January 16, 2020 Published on January 16, 2020

Motofumi Shitara, Chairman, Yamaha Motor India   -  Bijoy Ghosh

Development underway in Japan as part of the premium mobility vision

Motofumi Shitara smiles when asked if his company will go beyond the Fascino and Ray scooter brands for the Indian market.

“There is a model (development) on at Japan…some interesting engineering is happening,” says the Chairman of Yamaha Motor India Group. All he can divulge for now is that this is part of the strategy for scooters in India, where the focus is on expanding the premium segment.

Clearly, Yamaha has not taken its eyes off India even while it has struggled over the last few decades. There have been inexplicable product detours but the strategy now is to stay committed to the premium space. This is where the new scooter(s) being developed in Japan are part of the plan to grow market share.

It was some weeks ago that Shitara and his team announced a product blitzkrieg for India that would comply with the new Bharat Stage-VI emission norms. In the process, the message that came through loud and clear was that the focus would now be completely different.

For instance, as Shitara says, Fascino was synonymous with fashion — which was fine as a differentiator, but there was really no point targeting women customers as the core customer base. “We can’t close the gates to men,” he reasons.

This meant that the Fascino had to go beyond just making a fashion statement in the scooter space. It also had to get a renewed fix on engineering and technology. “This is all about Yamaha performance to meet customer preferences…it is about differentiation with a host of technologies,” explains Shitara.

This is where the company is betting big on showcasing its competencies in the BS-VI era, both in scooters and motorcycles. “I think we are better prepared. Price is important in India but, in the future, customers will also seek high technology along with premium and sporty offerings,” he says.

By the end of the day, the differentiation needs to be evident in engineering, mileage, performance “and everything that is Yamaha”. As Shitara says, young customers want something new in terms of experience and it is here that the company needs to do its bit while focussing on the premium/deluxe space. Clearly, retail will play a big role here and this is where the recent ‘Blue Square’ model is intended to improve the entire buying experience.

For now, there is one in Chennai but the plan is to have 100 such models in place by the end of this calendar, going up to 300 in the coming years. The focus will be on metros as part of the drive to reboot the Yamaha brand message as being upmarket and premium. Essentially, Blue Square just goes beyond selling bikes and scooters to getting customers to experiencing Yamaha as a lifestyle brand.

Transition to BS-VI

Electric is yet another domain that could gain traction during the latter part of this decade. Even while BS-VI marks a new frontier in emissions, it is no secret that policymakers in Delhi are keen on pushing for electric mobility in a big way. Shitara has, in the recent past, told this writer that BS-VI is top priority now even while the transition to electric is inevitable for the cause of clean air.

“We are currently making significant investments in the upgrade to BS-VI emission norms. There is a lot of new investment which has gone into building up the capacity, changing the machinery that is not only from us, but also from the component suppliers,” he had said.

Clearly, this means that Yamaha needs “adequate time” to recover these investments.“Moving to electric vehicles will require forward planning, developing of charging infrastructure, as well as a proper supply chain system,” said Shitara.

From Yamaha’s point of view, electric represents a new business model where cooperation could be the driving force in making its sustainable. For instance, the company has tied up with Hero Cycles for electric-assisted bicycles. In countries like Taiwan, it has a partner in the e-scooter maker, Gogoro, where the two have collaborated in the launch of a new product, EC-05.

Shitara believes that there are a host of areas that need to be thought out carefully in the electric domain, right from pricing and performance to drawing up the right business model. For instance, should the function of sales be carried out by another entity? Likewise, infrastructure remains a big challenge and this is where customers could be deterred from buying an electric option.

For now, Yamaha is not likely to push aggressively forward with its electric plans in India since there are other top priority areas which need attention, especially from the viewpoint of building market share. The most important of these is to send out a strong statement of its competencies in the BS-VI era, where the company will have to balance this out with competitive pricing.

Over the last two years, Shitara has been focussing on rebooting Yamaha in terms of its renewed focus in the premium space. This will now be accompanied by a new thrust in retail while ensuring that a new generation of customers get around to experiencing the real Yamaha DNA.

Stiff competition

The company is hopeful of building its market share over the next few years though it will be no walk in the park. Right now, it is pretty much a marginal player up against stiff competition from local players such as Hero, Bajaj, TVS and Royal Enfield, while its Japanese counterparts like Honda and Suzuki are no pushovers either.

Going by what Shitara says, collaborations could throw up some interesting opportunities, especially in areas like electric mobility. It also remains to be seen if Yamaha will extend its cooperation with Honda beyond the space of small scooters in Japan.

Cooperation with Honda

Industry observers believe that the two could explore coming together for electric as well as other non-competitive areas in the mobility space. In an interview with this writer, former President of Yamaha Motor Corporation, Hiroyuki Yanagi, had said that too much should not be read into the famous Honda-Yamaha, or H-Y, war which was prevalent decades ago.

“All this happened over 30 years ago. That was during the old generation management but we represent a new generation that thinks differently,” he said. According to him, electric bikes represented an important mobility initiative for the future.

“However, in the case of e-motorcycles, there are technological difficulties compared to four-wheelers. We will try and make a good alliance with Honda as each of us has some know-how in this space. If we can put that together, there will be better technology in the process,” Yanagi had said.

In the motorcycle industry, while competition is very important, “harmonisation is as critical”. It remains to be seen whether Honda and Yamaha will actually take their partnership to the next level, though it is quite apparent in recent times that consolidation is the name of the game in Japan.

In the car space, Toyota has forged close ties with Suzuki and Mazda while Nissan and Mitsubishi have come together, too. It is also no secret that Renault and Nissan are struggling to rebuild their alliance and it will be interesting to see if there is yet another round of marriages happening in Japan’s automotive ecosystem.

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Published on January 16, 2020
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