Wednesday, November 24, 2010

Bajaj Auto to expand network with 130 new dealer and 1,100 service centres by next year

Bajaj Auto which is on an aggressive mode while leader Hero Honda is in jitters over its impending JV issue with Honda is now planning to go the bottom of the pyramid. The company has said that it is planning massive distribution network expansion to meet robust growth targets, adding 130 new dealerships and upgrading 1,100 service centres by next festive season.

The company which has its strategy clear with premium Kawasaki and KTM brands, it is planning to distribute two brands Pulsars and Discover to be the two major brands. The new dealers, largely in small towns, would take the total number to more than 600 dealerships across India.

According to S Sridhar, President - Motorcycle Business, Bajaj Auto, the company is well placed in terms of distribution as far as Pulsar - a premium brand, with an urban focus - is concerned. "On the other hand 'Discover' which is a mass commuter has huge potential in smaller towns. While Discover's growth in terms of volumes and market share has been outstanding, the next big boost will come from increasing the share in these towns and in rural India which accounts for more than 50 per cent sales of this category", he said.

According to him, these new dealerships will help the company to increase the share in this model in smaller towns which are today inadequately catered to by only the secondary network.

The company said it is also working with a reputed international retail design agency to enhance the experience at its dealerships. Around 1100 service centres are being upgraded at an investment of more than Rs 18 crore to enhance the service standards in these markets as well.

A typical Bajaj dealership in these towns requires 1800 sq ft. of showroom space, 2200 sq ft. of workshop space, and has the direct employment potential of approximately 50 people which can significantly boost the local economy, according to the company. This expansion in 130 towns would therefore create 7,000 new jobs in the country, it said.

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