TVS plans new 100cc entry level offering

Chennai-based TVS Motor Company Ltd (TVSM) is planning to launch an entry-level 100 cc motor cycle, TVS Star, by the end of this month. The company has also plans to invest Rs 200 crore in product development this year.

Discussing on the sidelines of Automotive Component Manufacturers' Association's annual convention, Venu Srinivasan, chairman of TVSM, said his company will capture 33 per cent market share in the entry level market. He said the company share in this segment was 40 per cent two year back but has since lost to competition.

TVS is also planning to set up a manufacturing subsidiary in one of the South Asian countries. Srinivasan said the subsidiary could be in Thailand, Indonesia or Vietnam.

The proposal will be placed before the board by the year end for approval and the plans could materialise in 18 months. He further said the overseas venture will not be a joint venture with a local partner.

"The 'TVS Star' is ready for the launch. The motorcycle will hit the roads in the last week of this month. We are also going to invest Rs 200 crore for new products," Srinivasan said. The new motorcycle will be manufactured at the company's Hosur plant in Tamil Nadu.

With the launch, the company aims to have 33 per cent market share in the entry-level segment. The company is launching Star after phasing out its two-stroke entry-level Max range of motorcycles.

The company also aims to sell 1.4 million two wheelers this year. At present, the company has a production capacity of 110,000-120,000 units a month and it targets to sell 80,000 units a month by October this year. The company is also planning to scale up monthly sales to 100,000 units by April 2005.