Date:14/02/2003 URL: http://www.thehindu.com/2003/02/14/stories/2003021402321600.htm

Business

Building on brand image

By Our Corporate Reporter

CHENNAI FEB. 13. The two-wheeler major TVS Motor Company will focus on building its TVS brand in India and other countries especially in Asia and achieve costs at globally competitive levels.

In an e-mail interview, the spokesperson of the company said, "We need to train leaders for supporting business growth for this to become a global company for which we have to develop advanced technology and multi-project management capability".

With the intention of becoming a global motorcycle player in the next five years the company as a first step is looking at being a major Asian player, particularly in the Southeast Asian and Asean regions by 2005. Industry estimates point out that the two-wheeler market is expected to be around the 40-million mark by 2008-10. Out of this, India will account for around 20 million and the Asean region 10 million.

"We are aiming for 12-15 per cent of the 40 million pie. We have a 19 per cent share of the motorcycle market in India while our overall two-wheeler market share stands at 22 per cent. The Indian two-wheeler market has a size of over Rs. 10,000 crores. TVS Motor with a 22 per cent market share in the domestic two-wheeler industry is one of the three companies that account for more than 80 per cent of the industry," sources said.

The two-wheeler sector contributes the largest volumes. In the last few years, there was a marked shift towards motorcycles from geared scooters. In the rural areas too, consumers prefer sturdier bikes.

Post separation with Suzuki, TVS Motor has doubled its investment on research and development and could spend around Rs. 60 crores this year. It has also lined up an annual investment of Rs. 200 crores for the next three years towards expansion of its plants, overseas explorations, research and development and promotion and new products.

The company plans to become one among the top five global two-wheeler players by 2009-10. It has in place leading automobile consultants and project coordinators. As such, the separation has had no adverse effect. The company has also instituted a mentorship model whereby prominent specialists from various fields would be involved with the company in a mentorship capacity.

"We are working on an aggressive plan over the next two years that could see the launch of new platforms and a slew of models. We constantly need to offer buyer innovations that meet their aspirational needs. It was important for the company to be agile and find niches so that it could occupy them early.

The company has already spent Rs. 120 crores this year on expanding its Mysore plant capacity. The project, started about seven months ago, will be completed this financial year. The company has just launched the new Scooty PEP and the Fiero F2 from this plant. The expansion project includes an assembly line, a machine shop and a new facility for producing gears. The plant capacity will increase to half a million bikes by May.

TVS Motor, the largest manufacturer of mopeds with a market share of 66 per cent, is a dominant player in the South.

The company intends to improve steadily its market share at the expense of other leading two wheeler producers.

As competition hots up, the company is chalking out an aggressive marketing strategy to race ahead. It is all set to extend the number of dealership and service centres in the near future. It will continue to strengthen its penetration in the northern and eastern part of the country.