Royal Enfield chief not worried about Bajaj Dominar
Siddhartha Lal, CEO of Royal Enfield owner Eicher Motors, said that he is not worried about Bajaj's entry into the 350-plus cc bike segment.
In the final month of 2016, Indian bike maker Bajaj launched its much-awaited Bajaj Dominar 400 motorcycle. The Dominar is Bajaj's highest-displacement bike yet, with a 373 cc engine derived from the extremely popular KTM Duke 390, which also got a thorough upgrade late in February 2017. Rajiv Bajaj, the MD of Bajaj, said during the launch that it was entering a market segment that is dominated by a single entity. This, of course, was a reference to Royal Enfield, a British-Indian heritage brand now under Eicher Motors and a company that holds an around 95 percent share of the segment of 350 cc and above motorcycles.
With the Bajaj Dominar available at a mouth-wateringly low price of INR 1.36 lakh (ex-showroom Delhi) and offering a more advanced package that Royal Enfield, Bajaj does seem to have the right tools to take on the heritage brand. But Siddhartha Lal, CEO and MD of Eicher, told in an interview with Business Standard that he is not worried about the entry of what could be a very strong competitor in its segment. "When one succeeds in a segment, others try to enter and take a bite. Of course, there will be competition but we are not worried," he said. Also Read: Dominar 400 helps Bajaj Auto to report 2,73,513 sales in February 2017
Rajiv Bajaj has said that the Dominar is designed to be the opposite of what Royal Enfield offers. "This segment is not open for anyone to simply enter and walk away with the market. One has to be the opposite of what the market leader is," he said. While Royal Enfield offers old-school looks, a simple design utilising decades-old technology, heritage and a strong follower base, the Dominar offers a more modern perimeter frame, a more powerful engine and updated electronics, including the safety net of ABS. Bajaj sold 3,000 units of the Dominar in its first month of January and hopes t reach 10,000 units in monthly sales by September. Royal Enfield, meanwhile, sells a steady 48,000 units every month. Mr. Lal said about the arrival of Bajaj, "It is important for us to grow the size of the market. If others want to grow it, it is good." Also Read: Royal Enfield Classic 350 beats Bajaj Pulsar in January 2017 sales
He added that Royal Enfield offers a different kind of bike with a unique value proposition. "People who like us will come to us. We will continue to work on the brand, retail and marketing. People who are part of the Royal Enfield family continue to stick to the brand. They like what we do after we sell them the motorcycle," he said. The company plans to open around 100 new sales outlets every year, particular in Tier III towns. It currently has around 650 showrooms. Royal Enfield is also working on building another factory to nearly double its capacity to 900,000 units annually by 2018.