TVS Motors today announced a tie up with BMW Motorrad, BMW's motorcycle division. We saw it coming but today it has become official.
Mr. Stephan Schaller, President of BMW Motorrad and Mr. Venu Srinivasan, Chairman of TVS Motors signed a long term cooperation agreement in an event held in Chennai. As per the collaboration, both the two wheeler makers will jointly develop and produce a new series of motorcycles which have displacement less than 500cc.
TVS and BMW will actively participate in various aspects of product development there by leveraging each other's strengths. For instance TVS is an expert in making small products in mass scale with robust supply chain, while BMW's bikes that have high stability, agility and performance figures. However, the products will be implemented with different focus areas on each side. Both the companies will offer their own derivatives of products which will be sold through their existing sales and distribution network across the world.
According to Mr. Venu Srinivasan, the tie-up will give birth to "small motorcycles with mass scale and high quality" which are less than 500cc. Every product from the co-operation will have two variants to be made in India, one for BMW which will be sold throughout the globe while the other is for TVS to be sold in the markets where the Indian automaker is already present such as India and Indonesia. The motorcycles will be made at either Hosur or Mysore where TVS currently manufactures its bikes.
BMW's variant is expected to have premium technology and features while the TVS' counterpart is expected to cater to the affordable segment positioned above the Apache. The agreement opens up new avenues for both the manufacturers. BMW is not currently present in sub-500cc while TVS has no presence beyond the 180cc segment as of now. TVS hopes to secure a profitable and sustainable future through this venture.
The products will come out sometime in 2015.
Pointers from the press conference:
- BMW sold 117,000 motorcycles worldwide last year, its best performance yet.
- BMW sells motorcycles in 100 countries and is a market leader in 13 of them.
- Currently BMW has 19 products in the 650-1,600cc categories with engines of 1,2,4 and 6 cylinder types.
- BMW's entry below the 500cc category is mainly for markets in Asia and South America.
- Various types of motorcycles are being considered in the long term offering stability, ability and performance figures that BMW Motorrad is known for.
- TVS is investing 20 million Euros in India while BMW is not forthcoming on the investment plans. It will take care of all the testing and development costs of the bikes which will be executed in Germany.
- The companies are not discussing the categories under which the motorcycles will be classified under. BMW have categories such as tourer, urban mobility, roadster, sport, etc.