The question has a numerous answers as the Indian market is the second largest two wheeler market all around the globe foreign manufacturers who once had never seen India a nice place to sell their motorbikes.But time had changed and every foreign manufacturer who once thought India is not a good place to sell higher displacement bikes have changed their minds and some already had entered into the Indian market.Some companies entered the market with partnership with Indian motorcycle manufacturing companies and some had landed on Indian shores independently some companies which are present in Indian market with smaller displacement specific Indian models had started importing their higher displacement bikes to India. Bajaj had partnered with KTM in which Bajaj has 40 % share.So Bajaj had decided to launch KTM and some Bajaj bikes up to the displacement range of 700 cc in India which would be manufactured in India which keeps their costs down may definitely sent an alarm to other manufacturers.Bajaj already turned Pro-Biking showrooms into KTM stores to offer better sales and servicing for KTM bikes.
First we discus about the two methods by which bikes are imported into India:
The first method is CBU:
CBU means Completely Built Unit in this method the bike will be completely built (it would have everything fitted) somewhere else where the company which imports bikes to India has a manufacturing plant and will be shipped to India.Companies employ this method to reduce the cost of building factories and employing labor because as the higher displacement bikes sales volume is less they may not be able to make a profit on them if they had to produce them in India.
What are the disadvantages in Importing Bikes to India:
The first disadvantage is that when these bikes are imported to India according to Indian government Import rules the companies had to pay 100 % of the value of the bike from which country it is being imported as tax to the Indian government.This makes the price of the bike doubled when compared to the price of these bikes in countries like America.
The second disadvantage is when these bikes are imported there is no need to employ workers for building the bikes.So although the companies make profits the employment doesn’t increase.
Example of CBU bikes in India are Yamaha YZF R1 and Honda CBR 1000RR you could now easily guess why this bikes have a price tag that only some people could afford.
The second method is by CKD:
CKD means:Completely Knoced Down.It is also the best method when compared to CBU.In this method the bike will be sent in individual parts and Indian government will impose a 10 % tax and the bike parts will be assembled in India in this way 90 % of tax money could be saved and employment will be provided becuase the parts have to be assembled in factories where man power is required.
Exaples of CKD bikes in India:Honda CBR 250R and Hyosung GT 650R and Ninja 650R as well as Ninja 250R.
Bajaj had already launched KTM Duke 200 in India manufaturing for the Duke 200 is done in Bajaj Chakan plant.Bajaj also launhed Pulsar 200 NS which is more technically advanced than the previous generation pulsars.So with the aggresiveness of Bajaj and KTM duo the Indian two wheeler market is heating up so other manufacturers should also look for alternatives to CBU.
So coming back to the discussion who would be worried about Upcoming Bajaj and KTM bikes ?
Firstly Ducati comes to my mind this exotic super bike and street fighter bikes from Italy is regarded as the world’s best bikes in terms of styling and exotic nature and are priced more than Japanese bikes making them a pride to own.Ducati also has a heritage that attracts buyers to the brand.This company bikes are also known as Ferrari in Motorcycles.With the unstable European economy Ducati had thought that it had to have a market share in Asian markets and acted fast by coming up with the Ducati Monster 795 for emerging markets in Asia.Which is recently available for bookings in India the Ducati 795 may be the most affordable Ducati but it has all the characteristics of a Ducati.But Ducati manufacturers the bike parts in their factory in Bologna and then they will be assembled in Thailand and will be imported to India as a CBU which has to pay up to 60 % in taxes the reduction of tax was the consequence of India and Thailand free trade agreement however the excise duties and special excise duties add up to make 60 %.Maing the price of the bike starting at rupees 6.99 lakhs Ex-showroom.And also other factor to be considered is Ducati only has 4 showrooms available in India.
Yamahahas been selling its whole range of imported higher displacement bikes ike the V-star R1 and many other models.Although you could even
book an Yamaha R1 in your nearest Yamaha showroom but they wont be servicing it.Yamaha had plans to launch Yes Yamaha stores to exclusively maintain sales servicing of higher displacement bikes and the race born Yamaha R1 and FZ and Fazer models.But as all the Yamaha high end motorcycles are imported there price has sky rocketed so Bajaj has a distinct advantage over Yamaha because of the price point.
Honda one the most trusted brands in the world for motorcycles and as well as cars.This Japanese auto maker also imports its whole range of super bikes into India and these bikes unlike cannot be booked at your nearest Honda showroom only be booked in Metropolitan cities and these stores which sell these bikes will offer servicing.
Hysoung they have already Launched Hyosung GT 650R and GT 650 which is a naked version of GT 650R they are also planning to launch GT 250R and GT 250 a naked GT 250R to rival with other 250 cc bikes in Indian market.
Suzuki in India has a bike range starting from 125 cc they have one bike in 150 cc it is GS 150R and after that their range of motorcycles start from Intruder 800 meaning they don’t have bikes in between above 150 cc and below 800 cc showing a huge gap in between the motrcycle classes offered by Suzuki.The Intruder 800 is a CBU and Suzuki also import other high end bikes like the Hayabusa as CBU to rival with Yamaha R1 which is also being imported into India.Suzuki competes with manufacturers like Honda,Yamaha and Kawasaki in various classes in the world where ever Suzuki has a presence so one could expect Suzuki may also introduce their complete line up in India.Suzuki had also announced plans foe the possible launch of a 250 cc bike