Bajaj: Amazing comeback

“Bajaj Auto”. is a prominent name in Motorcycles today. But rewind Back 15 years and perhaps even in ur wildest dreams u wouldn hav imagined this much growth and market share for Bajaj. During early days(1984)Bajaj

Auto’s major field was Scooters. Its was considered the King in Indian Scooter industry. It had a collabration with Kawasaki to introduce motorcycles. They produced the famous KB 100 series competing against range of 2-stroke bikes and mainly the RX-100 from Yamaha. Those were the times when the Indian economy was a closed one, where it was very difficult for foreign player to enter the Market.

But the liberalisation of our economy in 1991 opened up new avenues as well as incresed competition for most of Indian companies. Bajaj was headed by its founder and CEO Mr. Rahul Bajaj at that time. He became famous as head of the Bombay Club, opposing liberalisation till there was a level playing field for Indians and foreigners.The Bombay Club managed to slow liberalisation but could not stop it. Moreover, liberalisation brought the threat of cheap imports and FDI from top companies like Honda. Meanwhile Indians began to prefer motor-cycles to scooters, and Bajaj Auto could not touch Hero Honda in this field. Bajaj had released the K bajaj 4S champion which took of well only to lose to Hero Honda. Its K bajaj Boxer AT also failed miserably with HH launching Splendour which was a run away hit(still running now).Kawasaki also parted leaving the future of Bajaj motor cycles a big question mark.Scooter sales continued to plummet, the recession and stock market collapse of 2001 hit the company hard, and some stock market analysts thought it was doomed.

It was the time Mr. Rajiv Bajaj, Rahul’s eldest son, came back to India from business school in the US. He took a hard look at the company and came to very different conclusions. He saw that Rahul’s ambition of becoming world No. 1 in scooters was irrelevant in a global economy where motor-cycles ruled supreme, and that the company needed to change its strategy accordingly. What followed was a stunning peice of turn around which has all criteria to get into the best books of Strategic Management!!!.

His startegy was simple yet path breaking. When u have a competitor so strong as HH dont compete in his domain of strength. The 100cc market was HH strength. Repeated attempts to compete in that space by Caliber, Boxer AT didnt make much of a difference. That was the time they decided to launch something new, perhaps create a new market. The concept was Pulsar began to grow. The Pulsar underwent almost 2 years of R&D. After so much of efforts and sweat Pulsar was launched in 2001 in two variants. 150cc and 180 cc. For the first 3 months the bike was termed a failure. I remember my Friend booking Chennai city’s 3rd P-180 and we all ridiculed and laughed at him saying “u hav brought a failure model.CBZ rules always!!!”. But the performance was jus awesome. The power it could generate, the macho looks, the huge tank, it was like a Wresler. A well-oiled Wresler. Gradually the sales began to pick up by the end of 8 months, Pulsar was considered a Huge hit with P-150 leading the way. Pulsar instantly became the fav of all collage lads. The result was so obvious in the Stock prices.

The dream did not stop with that, having created and captured the upper market(more than 150cc). Bajaj immdeiatly revamped its older model The Boxer At. It did some face lift and rechristened as Bajaj Boxer CT. The pricing played a important role here. When all HH model were priced higher, the Boxer CT was made available at 34k odd. The diff in price for CT and Splendour was a whopping 10K. Slowly it began eating the market share of HH. But HH was still going good with its splendours, Passions and CBZs.

The masterstroke which Bajaj had planned yet failed was the Calliber 115 and Wind 125!!!. Yes Bajaj’s ploy was not to directly attack a strong competitor but to close all his ways and then kill him by cornering!!. Bajaj already had a Upper market(CBZ sales soon dwindled due to poor mileage), it was growing in the lower end 100cc market. Its aim was to capture the 110-125 cc market so that customers are left with more alternatives from Bajaj. But sadly the only thing that clicked for those two bikes were its marketing campagins.This provided the HH some way out which had lately realised the submerged threat from Bajaj.

The R&D of Bajaj then came up with a jem of reaserch – The DTS-i (Digital Twin Spark ingnition). The DTSi technology incorporates twin sparkplugs at either ends of the combustion chamber for faster and better combustion. Single sparkplug meant slower burning of the air-fuel mixture and sub-optimal combustion chamber characteristics. Soon the Pulsar DTSi was launched with the much needed front fairing. It was a craze then. The snail paced HH was still running its splendours and passions, but took some intiative and launched the Super Splendour and Glamour.(both 125cc bikes).This space where Bajaj had let off briefly, only to come back stronger with its Discover 125cc. This also had the DTSi technology.

The Pulsar then launched the stuningly handsome Pulsar Version 3 with a low flung head peice, smashing alloys wheels and a new rider position. It aslo improved the suspension system with gas filled(Nitrox) shock absorbers. Bajaj very strongly captured the upper segment market share, competing the likes of HH Karizma and new entrants Honda Unicorn, and the TVS Apache.

The latest Pulsar version(4) has new designed heald light, A LED(Light Emmiting Diode – faster response time than ordinary bulbs)tail lamp, A LCD Digital Speedo wih Odometer. Unbreakable indicators, car like indicator turn switch. Though the latest bikes form TVS (RTR), Honda(Unicorn) and HH(Extreme) are also very good bikes and are competing for the space orginally created by Bajaj.

What is more important is the way these two companies hav taken their businesses about. While HH was leathargic for most time, Bajaj had been constantly innovating. The splendour was a splendour for more than 10 Years now. but the Pulsar has undergone 4 upgradations in 5 years. Yes, there may be some quality issues, but Bajaj didnt produce motorcycles from the time Honda, Suzuki or Yamaha started. For an Indian company to have taken up these forigen gaints head on and winning it is something really great. The stock prices for Bajaj as of now is 2 times higher than HH.

One need not be a proud Indian only when we win a cricket match against Pakistan or winning a Hockey world cup. U can proud of this Indian who had made a company resurge after everybody closed their doors on it. I am not saying Pulsar is a great bike or Bajaj is a great company, No, my intention is not that. There are bikes in India which are far more superior and refined than Bajaj bikes. Infact i dont own a Bajaj or i am not planning to own one!!. But i want u to appreciate the guts and brillance of Bajaj’s strategy. I want u to know how much efforts was put in at a difficult time to bring out the pulsar. Its a star for Bajaj.

Always remember, “Its not great to take up horses and train them to race. Its about taking in donkeys to race against horses and winning it too!!!”.

SMS lån
sms lån

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s