TVS plans joint venture to enter Andean market

Two wheeler maker TVS Motor Company, which is planning a joint venture (JV) in Columbia, targets 12 per cent of the two wheeler market in South America (Andean countries) by 2009. The Andean market includes Columbia, Peru, Bolivia, Chile, Equador and Venezuela.

The Columbian joint venture,which is in process, will be formed with a local passenger vehicle company for an assembly unit. With this move, TVS will become the first two wheeler manufacturer to enter the Andean market.

At present, the JV local partner has no presence in the two wheeler segment. TVS will be a minority partner in the JV. Also, TVS Motor will be the only Indian two wheeler company to have a base in South America.

"Initially key components and engines will be shipped from India to Columbia. We would look at manufacturing in the country after gaining a substantial market share of say 10 per cent in the region. We target the entire Andean market with the Columbian facility," said Venu Srinivasan,chairman and managing director, TVS Motor Company.

"The size of the Andean two-wheeler market is around 2.5 lakh to 3 lakh bikes with an annual growth rate of 10 per cent. The market is cornered by the Japanese giants such as Honda, Suzuki and Yamaha, with not much participation from the local players.

Our objective is to expand the market with our unique range of low budget bikes," said HS Goindi, senior vice-president, International Business, TVS Motor Company. The Japanese players market only high technology bikes in the region. The low market size is because of the small population in the region that is about six crore.

TVS plans to introduce complete range of two wheelers here starting from stepthrus to regular models such as Victor (motor cycle), Scooty Pep(scooter), and Apache.