LML, India's leading scooter manufacturer has slated a slew of launches, particularly in the motorcycle segment, to boost growth. The company has also undertaken a major restructuring exercise to create a flexible manufacturing system.
LML is India's second largest scooter manufacturer with 27% market share (September 1999). Its brands are recognised for their styling and aesthetics. LML had earlier entered into an equity tie-up with Piaggio, but the relationship between the two partners soured and currently it only has technical tie-ups with some MNCs like Daelim (South Korea).
LML has eight launches on the anvil, including a range of stylish motorcycles. The company also has plans to come out with upgraded versions of all its existing models. All these launches will entail an investment of Rs 1.2 bn, in addition to the Rs 3.5 bn that the company has already invested over the past three years.
The company has sketched out ambitious plans to ride the motorcycle boom in the country. It has entered into a technical tie-up with Daelim of South Korea for its motorcycles. The company will launch a range of motorcycles in the 100 cc, four-stroke category in a price range of Rs 40,000-50,000. It has set itself an ambitious sales target of 60,000 motorcycles in FY2001.
Also on the anvil is a scooter Z-2000 targeted at the export market initially and will be launched in the domestic market by July 2000. The company will launch two new versions of the four-stroke two-wheeler Clipper in the first quarter of 2001. This was reported by a leading financial daily.
LML finally seems to be cleaning up its act. It has realised that the best bet for growth in the two-wheeler segment is new launches at regular intervals. Given the kind of competition the company is facing, it had little choice. The perceptible shift from scooters to motorcycles is in line with the company's strategy to increase exposure to motorcycles, which have seen amazing growth. The string of motorcycle launches (three within three months) will give it a decent break in the motorcycle segment. But breaking the stranglehold of the Indo-Japanese manufacturers (Hero Honda, TVS Suzuki, Bajaj Auto) will not be easy and LML will have to employ strong brand differentiation techniques to gain a competitive edge over others.
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