"Freedom is a portfolio brand, not just a product brand," Bajaj Auto Executive Director Rakesh Sharma told investors during a call.
19 Jul 2024 | 6262 Views | By Kiran Murali
Bajaj Auto Ltd, which launched the world's first two-wheeler powered by compressed natural gas (CNG) earlier this month, intends to have a portfolio of CNG motorcycles under the Freedom brand that can have more such models in different segments.
"Freedom is a portfolio brand, not just a product ...
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Bajaj Auto Ltd, which launched the world's first two-wheeler powered by compressed natural gas (CNG) earlier this month, intends to have a portfolio of CNG motorcycles under the Freedom brand that can have more such models in different segments.
"Freedom is a portfolio brand, not just a product brand," Bajaj Auto Executive Director Rakesh Sharma told investors during a call. The three variants of the Freedom 125cc motorcycle were designed based on the platform, which can be adapted to create higher and lower-powered CNG models in the future.
Bajaj Auto is a strong player in 150cc+ segments and has been trying to disrupt the entry-level and commuter segment that has been ruled by Hero MotoCorp. With Freedom, the automaker looks to cash in mileage-conscious consumers with an affordable solution.
The company sees good headroom for new business in the 100-125cc segment as the automaker currently has only about 15% market share in that segment. The management did give a timeline on when we can expect another CNG motorcycle on the Freedom platform.
"This a platform that is extendable on both directions. But exactly when we are going to introduce it, we will see. It is not ground-up work that will be required, it is a platform. And very quickly we can respond if there is a requirement emerging in the market," Sharma said.
Bajaj Auto launched Freedom 125 on July 5 in the price range of Rs 95,000- Rs 1.10 lakh and has started the deliveries. Initially, the model will be available in Maharashtra and Gujarat, and expanded to other markets gradually. It has received over 4,200 bookings for the model, of which customers from the two states account for 80-90%.
With Freedom 125, the automaker boasts of 50% savings in operating costs and 26.7% less CO2 emissions compared to similar Petrol motorcycles. The management noted that the model has an addressable market of up to 5 lakh units per month.
"Of about 1 million motorcycles sold per month in India, almost 75% are in the 100-125 cc segments. And about 60% of these customers have access to CNG dispensing stations. Hence the addressable market is around 450,000-500,000 per month. We are targeting all these customers with the proposition of fuel economy, style and comfort," Sharma said.
Currently, Bajaj Auto can produce 20,000 units of Freedom 125 in a month and plans to ramp it up to 40,000 units per month by the last quarter of this financial year.
Meanwhile, the success of Freedom will primarily depend on the availability of CNG across the states. "A key factor for the success of Freedom 125 will be the ease of CNG availability. We are hoping that the CNG distribution company will also take this opportunity to expand its business and facilitate the migration from petrol to CNG. This will help pump the rate of adoption," he added.
There are around 7,000 CNG dispensing stations in India across all major states with Gujarat, Uttar Pradesh and Maharashtra on the top. The government has set a target to increase the number of CNG stations to around 17,500 by the end of the decade.
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