Garware Motors sells Hyosung bike business to DSK Motowheels

DSK Motowheels Pvt. Ltd, a part of the approximately Rs. 4,000 crore DS Kulkarni group, has bought the motorcycle business of Garware Motors Ltd for an undisclosed sum. DSK Motowheels will now assemble, market and sell Hyosung bikes in India. DS Kulkarni group’s businesses include property development and automobile dealerships. Garware Motors, a unit of Garware Bestretch Ltd, was the technical alliance partner of Science and Technology (S&T) Motors, the South Korean owner of the Hyosung brand of motorcycles, which were first introduced in India in 2005 by Kinetic Engineering Ltd. Kinetic imported and sold the 250cc Comet and Aquila models. In 2010, Garware Motors announced a technical alliance with S&T Motors under which they imported the parts of the 650cc and 700cc models from Korea and assembled them in India. “The transfer of the Hyosung bike business to the DSK group of companies achieves Garware Motors’ strategic objectives at the current time,” Diya Garware Ibanez, managing director of Garware Motors said in a statement on Wednesday, adding that all the dealerships were transferred to DSK Motowheels as part of the transaction. The discussions to buy the motorcycle business of Garware Motors started earlier this year, according to Shirish Kulkarni, a director at DSK Motowheels. “The Hyosung business was loss-making for Garware Motors since it was only a year old and in the start-up phase,” he said. “They (Garware) had asked us to help out in marketing in Maharashtra but we did not want just another dealership and so offered to buy them out.” In India, Hyosung sells its 650cc and 700cc bikes, a segment that is estimated to have annual sales of 2,000 units. So far, it has sold around 600 units, giving it a 30% market share. The prices of the motorcycles in this segment average at about Rs. 6-7 lakh. “The bikes were overpriced. They need a more realistic pricing which some local assembly will help,” said Hormazd Sorabjee, editor of Autocar India. Kulkarni said this is an area they will focus on, pointing to the company’s immediate plan to import engines from Korea in a completely knocked down form and assemble them in India. “We plan to invest around Rs. 300 crore over the next three years, investing in a new manufacturing site at Shirwal. We will immediately import engines in completely knocked down format and start assembling them. This will help us bring down bike prices,” said Kulkarni.