Bajaj Auto and Japanese two-wheeler giant Kawasaki have entered into a global alliance to jointly market their products across developing countries, including in the Asean region and South America.
Buoyed by their success in the Philippines, where they tested the model for 4 years, the partners have now decided to take the next step to replicate the model in Indonesia, which could be followed by Brazil.
Two-wheeler companies sell around four million vehicles in Southeast Asian nations annually and both Bajaj and Kawasaki have a presence in Indonesia through their own distributors. Elaborating their joint strategy, Bajaj Auto Managing Director Rajiv Bajaj said, "We would like to take the Bajaj and Kawasaki partnership to the next export level. We have had a partnership for 30 years and have very little overlap. We would like to replicate the success in Philippines in Asean markets and will begin with Indonesia in 2013. We have great opportunities in other markets like Brazil, Thailand, Vietnam and Columbia. After Indonesia we may think of entering Brazil.”
Bajaj has a technology tie-up with Kawasaki and their bikes complement each other. While Kawasaki makes motorbikes mostly with over 650-cc engines at the upper end of the spectrum, Bajaj Auto is a mass player with bikes ranging from 100 cc to 220 cc. The tie-up will help Kawasaki offer a complete range of motorbikes.
The alliance will launch the Pulsar 200 NS in the Indonesian market. The Bajaj products will be co-branded and sold through distribution channels already present for both firms. However, Kawasaki bikes sold in that market will not be co-branded. It is akin to the earlier Fiat-Tata model, where both were selling each other’s products at their showrooms. S Ravikumar, executive vice-president, Bajaj Auto, said, “In principle, the agreement has been concluded. From now, teams will work out the details over the coming months, with a view to maximising Pulsar sales in Indonesia.” On Brazil, Ravikumar said Bajaj did not have any presence but Kawasaki had a 100 per cent subsidiary through which it sold large bikes.
Bajaj exports account for a third of its total volumes. From virtually no exports in the year 2000, it now sells over 1.2 million units across 35 countries. Africa is its largest market, accounting for 41 per cent of total volumes. That is followed by Asia, West Asia and South America.
