TVS aims to tap 5% Asean market by 2009

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TVS Motor Company, which is setting up an assembly unit in Indonesia, is targeting to capture 5 per cent of the Asean two wheeler market by 2009. Currently the Asean market for two wheelers is pegged at 8 million units.

The company's 1.2 lakh capacity Indonesian facility will become operational by the end of 2006. The company will invest Rs 250 crore in this facility.

"For touching 5 per cent of the Asean market, we will have to sell four lakh two wheelers in the Asean region in another 3-4 years. Once we crossed the level, we might even think of manufacturing in the region,"said Venu Srinivasan, chairman and managing director, TVS Motor Company.

As per the current plan, TVS will be exporting essential components including Engine from its Indian plant to Indonesia.

Once operational, the Indonesian plant will cater to the export requirement of other Asean markets including Malaysia, Philippines, and Thailand.

TVS will initially sell only step-thrus, the two wheeler range placed between a motorcycle and moped, in Indonesia and other Asean region as 70 per cent of the eight million two wheeler market in the region is cornered by step-thrus, said Srinivasan.

According to auto analysts, a 1.2 lakh capacity plant will not be sufficient to cater to the growing demand of the Asean region.

Therefore, TVS would look at the option of doubling the Indonesian unit by 2009.

Currently, Honda is a clear leader in the Asean two wheeler market followed by Yamaha, Suzuki and Kawasaki. Chinese and Taiwanese two-wheeler companies have, in recent years, been active in the Asean market.

The step-thru market was developed in the region by Hondas in the sixties and the seventies and the trend still continues.