Rumour mill: Bajaj-Kawasaki to break sales and service tie-up

Added in: Bajaj Auto

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According to reports, Bajaj Auto and Japanese two-wheeler maker Kawasaki are planning to end their sales and service tie-up. The tie-up is expected to end in month of April next year. Currently, Kawasaki sells and services their products up to the capacity of 650cc under the KTM outlets located across the country.

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Post April, the Japanese motorcycle manufacturer will sell all the products from its Indian portfolio through the dedicated Kawasaki outlets in India. This is likely to bring down the number of outlets that sell Kawasaki bikes from 160 to a mere 10 outlets as the dedicated outlets are located only in Tier-I cities.

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While the reason for the break in the tie-up has not been ascertained as yet, it is believed that the move could be a two way decision. The first decision coming from Kawasaki could be the fact that the brand is currently setting up its own dealership network through which it sells its CBU models, and the same outlet would now undertake sales of the CKD models as well. Another reason for Kawasaki can be sighted as the competition their products face from the KTM range.

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Bajaj Auto, on the other hand, could have a reason that the company plans to expand its KTM product portfolio in the country and hence would require more showroom space. Another reason that could have pushed Bajaj to make this move could be the higher profit margin on KTM motorcycles as compared to its Kawasaki counterparts. The report further added that although the Bajaj-Kawasaki sales and service tie-up could be called off, the company from the Land of the Rising Sun would continue to use Bajaj’s Akurdi facility to assemble its products.

Source: MotorBeam

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