Yamaha ties-up with Mitsui for Indian operations; company rebranded India Yamaha Motor
06 Mar 2008
New Delhi: The world's second largest motorcycle maker, Yamaha Motor Co, will set up a joint venture with Japan's Mitsui & Co to produce motorcycles in India, in a bid to revive the company's dropping sales volume of motorcycles in India.
The joint venture, called India Yamaha Motor Pvt. Ltd (IYM), would replace the existing manufacturing and business operations of Yamaha Motor India Private (YMI) Ltd. The new company will start operations in April and plans to increase its total capital to Rs5, 600 crore.
Mitsui, Japan's second-largest trading company would have a 30-per cent stake in the venture and would provide its sales and distribution network, apart from investing in expanding the company's Indian operations. Mitsui had earlier bought a 3-per cent stake in Yamaha last year.
Yamaha started its India operations in 1996 by establishing a joint venture company with the New Delhi-based Escorts Ltd, which later became a 100-per cent owned subsidiary of YMC in 2001.
Yamaha Motor India Sales Private Limited, a separate sales company was established in 2005, after which two companies specialising in manufacturing and marketing respectively conducted the Yamaha motorcycle business in India.
India is the world's second largest market for motorcycle sales with a sales volume of 7.3 million units in 2007. This year YMC plans to introduce high value-added models and promote a sales network strategy that includes expanding the establishments of directly run showroom/dealerships.
Mitsui with its strengths in logistics and dealer network will help stimulate a growth in sales of Yamaha motorcycles from 120,000 units (domestic only exclusive of exports: 60,000 units) annually in 2007 to 650,000 units (domestic only exclusive of exports: 90,000 units) annually in 2010 while improving the brand's presence in the fiercely competitive Indian market.
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