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KTM gets into top gear

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It completes its first year in India this month. And KTM AG, the Austrian bike manufacturer part-owned by Pune-based Bajaj Auto, is already getting into the fast track of brand launches in India. The brand, known for its street, off-road and superbikes, is now clearing the decks for two new product launches in the next 12 months.

Graduating from the 200 Duke (KTM has sold 8,500 units so far), KTM will launch the 390 Duke in the next four months in India followed by a toned down version of the RC8 super sport bike in early 2014. The RC8-inspired sporty motorcycle (which could be the RC25) will be the first racing bike from KTM in India. While the real RC8 sports a 1300cc twin cylinder engine, the RC25 could be powered by a 250cc engine, though officials at Bajaj Auto are tight lipped about it.

Besides, Bajaj will also import a few units of the RC8, which are amongst the most powerful bikes in the KTM line-up, directly from Austria in the next two months. It will, however, be used only for display purposes in showrooms and not for retail.

However the icing on the cake could be a smaller KTM Duke. The teams at Bajaj and KTM could look at a new and more affordable Duke-class motorcycle to reach out to the lower end of the market.

Presently KTM’s range starts at the 200 Duke, which costs Rs 1.3 lakh, higher than rivals like the Honda CBR150 and Yamaha R15. By bringing down the entry price of the bike, KTM hopes to tap a much larger base of the motorcycle market.

KTM started in India with the launch of the Duke brand which is famous in the European market for its street bike image — combining racing style with peppy engines. Both Bajaj and KTM decided that the time was ripe to launch the Duke or the KTM brand in India at a level above the space where Bajaj sells its own products. The 200 Duke was manufactured and launched in the Indian market by Bajaj. They were made at the company’s Chakan plant near Pune, the same facility where Bajaj produces the Pulsar motorcycle, its most celebrated product.

The 200 Duke is a result of a combined team effort of the Bajaj and KTM engineers. The bike was designed and developed almost entirely out of India. Further, all products that have an engine capacity of below 400cc will be developed by Bajaj Auto.

At the front end, KTMs are not sold alongside Bajaj’s bread-and-butter bikes like those under the Discover brand. To avoid diluting their exclusivity, Bajaj sold them through a separate line of retail network known as Bajaj Probiking.

The Probiking showrooms, most of which are set up by Bajaj’s existing dealer partners, have undergone a transformation recently. While it initially focused only on premium and performance-built products such as the Pulsar 200NS and the Pulsar 220, they have now been replaced by KTM while Bajaj’s own products are available at its own retail network.

With KTM in its line-up where it owns 47 per cent stake, Bajaj is aiming to replicate the successful brand and production strategy adopted by Germany’s Volkswagen for its own products.

Though brandingwise, Volkswagen, SkodaAuto and Audi differ vastly, the backend operations of the three brands share several commonalities including engines, platforms and components. This has allowed VW to operate profitably while addressing consumer demands with different products with separate positioning.

Similarly, the new KTM products, including the 200 Duke, share a variety of things with the Pulsar 200NS, one of Bajaj’s most premium products. Both are built using the same platform deriving power from the same engine.

The 200 Duke, unlike the Discover which stands for simple, mileage-oriented bikes, has been promoted for its racing instincts with powerful engines and lighter body. The company is now keen to spread the idea of racing in India through the formation of rider groups of the brand.

Amit Nandi, president, Probiking, Bajaj Auto, said, “About 30-40 per cent of the KTM customers know the technicalities and details of the bikes. For the balance, our entire effort is to handhold them and make them understand what racing is all about.”

Existing Bajaj dealers have set up 70 KTM sales outlets so far and the immediate target is to ramp it up to 75 in the coming months. In the premium class, Chennai-based Royal Enfield has the largest network of dealers.

Nandi says Bajaj has covered 70-75 per cent of the targeted market for the KTM brand and more expansion would continue in the coming months.