Commando Will Be Volume Puller Than Dominator In India: Norton Motorcycles
Norton Motorcycles is a British motorcycle marquee which was originally founded in 1898 in Birmingham, UK. In late 2008, Stuart Garner, its current CEO & Owner, bought the company’s rights from some US concerns and relaunched the brand by rolling out a series of products. Talking with BW Businessworld exclusively, he stated that its Commando will give more numbers than the Dominator.
Is there a specific reason that Norton entered the Indian market a little later than other countries?
We see India in the region as very important for Norton. Obviously, with importance, you wanted to be right and you want to choose the correct partner and understand the market. Over the last few years, we had quite a few approaches from Indian companies wanting to do a joint venture with Norton or wanting to represent Norton. None of them we felt were right. We wanted a partner that understood the brand, make the motorcycle first rather than being an accountant proposition or private equity or a big company wanting Norton to be a small part. So we never felt we got the right partner. Eventually, we were introduced to Ajinkya Firodia (Managing Director, Motoroyale). We saw an opportunity for both and were perfectly aligned. Within 15 minutes, we got the right partner. We tried in 25-30 countries for Norton and India will be one of our core markets in the future. That is why it is not just a distribution partnership but actually an equity joint venture. There is a direct investment going in with all sorts of resources you need to manufacture and distribute motorcycles correctly for the region. We are very committed to making this work in the next one or two years and then have longer term plans. That is why we made it sure that we have the right partners so that we can have all the engineering and designs in the region.
How difficult is it to crack the Indian luxury motorbike market especially when Harley Davidson, Triumph, Ducati, Suzuki, etc., have gained a sizeable scale here?
We had similar questions when we started in 2009-10 when we started in the UK market. The quality of the motorcycle, brand, heritage, etc. and the overall concept and product proposition we need to work hard to make sure we carve our own niche.There isn’t a magic formula otherwise everyone be using the same magic formula. We need to make our products stand out and we can only do that through good quality engineering, design, manufacturing components, production, marketing, dealer network, etc. We have to make sure that aftermarket sales, service and warranty is very strong to support us afterwards. All of those items to make it a compelling proposition. But our biggest advantage is we have a wonderful brand in Norton. We know that people are asking for Norton products which haven’t been in the market yet. We are looking forward to it.
Will you be assembling the products from the first day of the products’ launch?
We are going to make a special Norton motorcycle which will be all-British in design. It will be CBU and will have surprise elements which will show all- British and will be only for India in a limited edition. This will be limited to 30 units for the Indian market. That will happen early next year. We will be using the Motoroyale distribution network which is already having a dealership outlet in Pune, Delhi. Bombay, Bangalore, and Chennai. It is a multi-branded dealership network with a shop-in-shop format. We will be looking to have 12-15 dealers towards the end of 2018.That distribution network will deliver the volumes we are looking for. The co-developed product will come during the end of 2018.
What kind of investments are you planning for the Indian market?
Over the complete day, we have put in all the IP and brand rights and use, engineering capabilities such as engine platforms and all the model range. Then over the next few years, we have earmarked approximately $10 million will be going in for the partnership to get the distribution and tooling in place.We will be setting up our manufacturing facility in Pune. I would imagine that there will be an overall capital and resources that will get into the business to be in excess of $ 20 million. In the first phase, we will be distributing our products in India.Over the coming years, we will grow markets inside the ASEAN Free Trade Agreement. That will include Indonesia, Malaysia, Singapore, Thailand and other countries. That will again suit whether it has got the correct tariffs and import duties attached to it and whether the product fits that territory. So we need to remain flexible and learn the markets with the product range to make sure that we don’t just open up, say in Thailand, with the wrong product or the wrong capacity at the wrong price point.
Will you be finetuning your product lines in order to make them compatible with the Indian road and climatic conditions?
We are going through the industrialisation process (in India) now and evaluating which models are suitable for the domestic market. The agreement covers all of Norton’s models to come to the (Indian) region.But of course not all the models will be suitable for the region whether that be climate or road network. So we are appraising the models. We have said on day one that we can do Commander or Dominator. Going forward, some of the models may not be for the purpose for the region. So not all of the models will come as we need to bring the correct models (for the domestic market). One of the things the agreement also covers is doing the engineering and design work to make the products bespoke for the Indian market. Some of our engine platforms and models might be very right for the UK and Europe but may be wrong for Asian territories in India whether that be temperature, roads, homologation, and emissions. So we are doing extra engineering and design work on our existing models to make sure that they have the correct mix.
How well geared are you to leapfrog from BS-IV to BS-VI emission norms?
It is difficult to engineer the product today to meet that specification. What you need to do is get your engineering department to package the overall risks into that products so that the regulations get clearer with more transparency. We can finetune the overall product rather than retooling the engines and its major components.What we are going to do now is engineer out some of the risks so that we can have flexibility in the platform. We can have the same engines with new electronics, ECUs, catalytic convertors, exhaust pipes, will be compliant.
Which one will be your best selling model in India?
I think the Commando Sport and Cafe Racer will probably sell a little bit more than the Dominator, which is positioned a bit higher in the marketplace. The Commando, which will be priced in the range of Rs. 10-20 lakh, will naturally be the volume puller for us in the Indian market.
Are you working on electric superbikes for global market? If yes, will that eventually come to India?
We have to be very careful here that small electric bikes have a fabulous place in mobility and emissions reduction and is already building a good segment in the market. As far as I can see and speak to all our customers who enjoy large capacity bikes, nobody looks forward to an electric large motorbike. And I feel it is yet to be proven whether there will be a large capacity market for electric bikes. One of the reasons why a motorcycle guy has a bike is the thrill of a combustion engine. So I think we need more time to see whether bikes will adopt and accept large capacity e-bikes. I think there is a lot of risks at the moment to developing a large capacity e-bike before the principle is proven that there is a market for it (globally). To sum it up, the market for it is yet to be established.
