Bajaj Auto plans new models to stem slide

28 December 1999

Bajaj Auto intends to beat the drop in its market share with a slew of new models. It will be showcasing at least 13 vehicles at the Auto Expo in New Delhi in January 2000. Significantly, all of them will be powered by four-stroke engines. These will include four new motorcycles, two scooters and a three-wheeler. There will also be a compressed natural gas fuel option model of the three-wheeler.

The company’s much-awaited Eliminator, a 175-cc motorcycle, will be among the two-wheelers on show. All the vehicles are intended to be in the market in a year’s time and are compliant with India''s 2000 emission norms, according to the company.

Sales of Bajaj Auto''s two-wheelers dropped 2.3 per cent to 6.58 lakh units during April-November 1999 from 6.74 lakh in the corresponding period of 1998. Within this group, scooter sales plummeted 12.6 per cent to 3.59 lakh units from 4.12 lakh earlier. The company could derive some consolation from the fact that its motorcycle sales rose 10.8 per cent during the period.

Bajaj Auto is doing other things besides introducing new models. The company has planned a revamp of operations, for which it had hired management consultants AT Kearny. Based on the consultants'' advice, the company is re-organising its supply and distribution structure. This will result in a reduction in the number of suppliers in order to improve logistics and reduce costs.

The company has already restructured its organisation, reducing the levels of management. Its president Madhur Bajaj says future focus will be on marketing, technology, and human resources development. He is confident the new models, the renewed focus and the proposed changes will help the company overcome its market share problems.

Bajaj Auto is set to invest Rs 1,000 crore in the next four years to upgrade and modernise its three plants. The new two-wheeler plant at Chakan, near Pune, has already become operational.