What do you find extremely odd in the follow
ing description? “A fuel-efficient auto-rickshaw with a working meter, having ample leg space and a smart & extremely humble orangutan (!!!) as the driver!” We know, that was easy! A fuel-efficient auto with ample space and a working meter, simply doesn’t exist! As the statement mentions, it would be much easier to find an honest orangutan driving an auto! But still, autos continue ruling the travel roost in metros and auto companies, despite fighting each other till death, keep churning out the same old versions of outdated autos (if you believe CNG introduction is a mark of innovation, oh please...!). So what’s with the marketing warfare in this segment and what’s really with the product quality? “Bajaj Auto does not make ‘jugad’ (make do) products; we want to make high end, high value products for the consumer,” aggressively defended Rajiv Bajaj, MD, Bajaj Auto, to 4Ps B&M. The authority of the man comes naturally from the fact that his company controls close to 41.2% of the total three-wheeler industry.
Even though the in
genuity of the Bajaj three-wheeler – more commonly referred to as the ‘rickshaw’ – is now under threat. The young blood at the Bajaj helm is hell bent in furthering the game. However, after years at the dominating centre of action, Rajiv is suddenly feeling the heat from the new crop of competition creeping in, namely from Piaggio, Force Motors, Atul Auto and Mahindra. Rajiv’s concern has its roots firmly attached to the number of units that the competition sells. For information, between April-May 2007-08 (SIAM), out of the total 54,557 three-wheelers sold across the two segments of passengers and goods, almost 22,864 units were sold by Bajaj’s biggest competitor, Piaggio alone. Even though Bajaj has an edge because of its deeper market understanding and sheer penetration of its products in all categories, competing companies are now concentrating more on innovation.
For instance, Mahindra, another major player in the industry, offers its key product, the Champion series, in a larger capacity format. The same strategy can be seen being used by other competitors as well. This, at a time, when the Bajaj business model continues to revolve around the small capacity passenger segment, which aims at paid personal transportation. Figuratively, Bajaj products have evolved sticking to these specific lines, with the 4-stroke RLE and CNG variants being perfect examples of one platform utilization here. Competition, on the other hand, has been collectively focussing on the larger capacity, ‘partial’ point-to-point transportation. Moreover, it is surprising to note that while only 20% of Bajaj’s sales are contributed by the goods category segment, the competition has based its bread and butter on this less favoured sector. The reasons are not far to find. In the less-thanone- tonne goods category, the three- wheeler has emerged as a favoured product because of its cheaper cost price (compared to a four-wheeled commercial vehicle) and ease of maneuverability in congested traffic conditions.
Selling 4,330 units, 96.2% of Mahindra sales strucare overwhelmingly ‘goods carrier’- oriented; Piaggio’s 10,022 unit non passenger platform sales further vindicates the point. While speaking to 4Ps B&M, Paul Zachariah, Senior GM (Marketing), Atul Auto, revealed, “We are not competing directly with anyone as we are already in the good-carrier segment in a substantial way. Our main strategy is to expand our operations beyond the nine states we are currently present in.” Now the problem with Bajaj Auto is that it is stuck in a cleft stick situation where manufacturers are akin to scavengers feeding on market leftovers. Rajiv Bajaj stubbornly, though confidently, retorted to 4Ps B&M, “We have lost some market share in the short-term here, but this has happened because of heavy investments for the long-term (as) we would like to focus on four-wheelers and upgradations.”
ing description? “A fuel-efficient auto-rickshaw with a working meter, having ample leg space and a smart & extremely humble orangutan (!!!) as the driver!” We know, that was easy! A fuel-efficient auto with ample space and a working meter, simply doesn’t exist! As the statement mentions, it would be much easier to find an honest orangutan driving an auto! But still, autos continue ruling the travel roost in metros and auto companies, despite fighting each other till death, keep churning out the same old versions of outdated autos (if you believe CNG introduction is a mark of innovation, oh please...!). So what’s with the marketing warfare in this segment and what’s really with the product quality? “Bajaj Auto does not make ‘jugad’ (make do) products; we want to make high end, high value products for the consumer,” aggressively defended Rajiv Bajaj, MD, Bajaj Auto, to 4Ps B&M. The authority of the man comes naturally from the fact that his company controls close to 41.2% of the total three-wheeler industry.Even though the in
genuity of the Bajaj three-wheeler – more commonly referred to as the ‘rickshaw’ – is now under threat. The young blood at the Bajaj helm is hell bent in furthering the game. However, after years at the dominating centre of action, Rajiv is suddenly feeling the heat from the new crop of competition creeping in, namely from Piaggio, Force Motors, Atul Auto and Mahindra. Rajiv’s concern has its roots firmly attached to the number of units that the competition sells. For information, between April-May 2007-08 (SIAM), out of the total 54,557 three-wheelers sold across the two segments of passengers and goods, almost 22,864 units were sold by Bajaj’s biggest competitor, Piaggio alone. Even though Bajaj has an edge because of its deeper market understanding and sheer penetration of its products in all categories, competing companies are now concentrating more on innovation.For instance, Mahindra, another major player in the industry, offers its key product, the Champion series, in a larger capacity format. The same strategy can be seen being used by other competitors as well. This, at a time, when the Bajaj business model continues to revolve around the small capacity passenger segment, which aims at paid personal transportation. Figuratively, Bajaj products have evolved sticking to these specific lines, with the 4-stroke RLE and CNG variants being perfect examples of one platform utilization here. Competition, on the other hand, has been collectively focussing on the larger capacity, ‘partial’ point-to-point transportation. Moreover, it is surprising to note that while only 20% of Bajaj’s sales are contributed by the goods category segment, the competition has based its bread and butter on this less favoured sector. The reasons are not far to find. In the less-thanone- tonne goods category, the three- wheeler has emerged as a favoured product because of its cheaper cost price (compared to a four-wheeled commercial vehicle) and ease of maneuverability in congested traffic conditions.
Selling 4,330 units, 96.2% of Mahindra sales strucare overwhelmingly ‘goods carrier’- oriented; Piaggio’s 10,022 unit non passenger platform sales further vindicates the point. While speaking to 4Ps B&M, Paul Zachariah, Senior GM (Marketing), Atul Auto, revealed, “We are not competing directly with anyone as we are already in the good-carrier segment in a substantial way. Our main strategy is to expand our operations beyond the nine states we are currently present in.” Now the problem with Bajaj Auto is that it is stuck in a cleft stick situation where manufacturers are akin to scavengers feeding on market leftovers. Rajiv Bajaj stubbornly, though confidently, retorted to 4Ps B&M, “We have lost some market share in the short-term here, but this has happened because of heavy investments for the long-term (as) we would like to focus on four-wheelers and upgradations.”
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