The Mahindra Group is confident of the growth in the two-wheeler industry and is targeting revenues of Rs.20,000 crore from this business by 2020.
Speaking at the formal inauguration of group company Mahindra 2 Wheelers’ new research & development (R&D) centre here, Anand Mahindra, Vice-Chairman and Managing Director, Mahindra Group, said, “I was asked why we entered the industry about three-and-a-half years ago, and our logic was that there is a very sizable opportunity in the Indian two-wheeler industry and if you succeed, there is sizable scale to be achieved. The penetration levels are far below saturation point.”
The company has invested Rs.100 crore in setting up the R&D facility for its two-wheeler business and Mr. Mahindra said, “we are committing to spend Rs.500 crore in two-wheeler R&D in the next five years. We are keen to develop products that give more for less. There is no need for much investment in capacity building as debottlenecking has already been done.”
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The Pune R&D centre is the third largest two-wheeler R&D facility in India and houses 175 engineers and designers. This number is to be increased to 300 soon. The facility has an engine development centre (EDC), vehicle design & development facility, testing facilities and prototype centre.
The centre will enable Mahindra 2 Wheelers to undertake in-house design and development of engine technology for its motorcycles as well. The company also unveiled two new engines which have been developed at the facility. The first is a 110-cc engine while the second is a 300-cc liquid cooled engine.
“The new facility will allow us to design in India for the discerning Indian consumer. The Micro hybrid technology for the Duro DZ and the recently-launched Rodeo RZ with the new ‘Z’ series engine were developed at this facility,” said Mr. Mahindra.
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Anoop Mathur, President-Two Wheeler Sector, Mahindra Group, said, Mahindra 2 Wheelers would launch three motorcycles this year. “One is the 110-cc Stallio refresh ahead of the festive season, another is the 300-cc Mojo in the last quarter of the financial year and a third bike would straddle the segment between these two bikes.” Mr. Mathur was confident of high double-digit growth in the company’s business in the current financial year and said that in the medium- to long-term, the company would target 20 per cent of sales from exports, mainly Africa, and East Asia.
Mr. Mahindra said, “we have a positive outlook on the two wheeler business as penetration is very low. It is also going to develop in developed markets. Scooters are the fundamental mode of transport in development markets and are increasingly being used as an environment friendly response to climate change.”