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When the Mumbai-based Mahindra & Mahindra plunged into motorcycle racing championships, in 2011, it set out with a target. Three years after launching its bikes and scooters in India, Mahindra wanted to become a major provider of motorcycles or constructor (as they are usually called) to racing teams in the Moto3 championship.
Racing flair
In the 2015 season, which starts next month in Doha, Qatar, Mahindra has got closer to its target. In the constructor rankings, Mahindra stood third in both 2013 and 2014; it was, in fact, ahead of Honda in 2013, which boosted its standing among teams and brought it new custom. KTM, followed by Honda, though, continue to rule the top two places.
From supplying three bikes to two teams in the 2013 season of the championship that fields bikes with an engine of 250-cc (the smallest size in racing), it will be supplying nine bikes to four teams. Its home team (Mapfre Aspar Team), with which it will collaborate more, will get three of its bikes.
Three of the 16 teams shifted to Mahindra after 2013, eschewing allegiance to Honda, one of the largest suppliers of racing bikes at that level.
Mufaddal Choonia, CEO, Mahindra Racing, explains the differentiating factors: "The price is regulated, engines and chassis package prices are fixed. There is no undercutting. All bikes have similar top-speeds. The difference is the track support and customer service".
Mahindra has withdrawn its own team (racing till 2014) to focus on supplying bikes.
Wobbly track
Back home, in its commercial market, Mahindra, with its loss-making subsidiary, Mahindra Two Wheelers, has had a tough time keeping pace with fierce competition in the commuter category. Its motorcycle positioning misfired, with rehashed products, some riddled with issues. Its bike debut was marred when the 110-cc Stallio was withdrawn after a gearbox fault.
The bike was relaunched as the Pantero but without much impact. Its all-new Centuro sells a lacklustre 12,000 bikes a month.
In scooters, its debut was mostly with refurbished Kinetic scooters. It has five models in the 100-125cc range.
In April-December, 2014, Mahindra saw sales of 133,000, a fall of 6 per cent, despite an 11-per-cent growth of the overall two-wheeler segment.
Its market share stood at 1 per cent, when the market leader, Hero MotoCorp, had a share of 40 per cent, Honda Motorcycle and Scooter 26 per cent and Bajaj Auto 11 per cent.
Bump up the ranks
Ramping up its scope as constructor, Mahindra hopes the racing credentials will prop up its growth in two-wheelers, having entered the segment by buying out the business assets of Kinetic Motor Company.
Choonia says, "We had a company called Engines Engineering that had an in-house racing team in Italy. We were a fledgeling two-wheeler company then. This was a window for us to get into racing because racing is the pinnacle of technology, reliability and performance."
Not just technical know-how, the racing circuit also helps the brand. Moto3, for example, is popular in Europe, the Americas and Asia, with Choonia claiming that Mahindra has recall in Italy and Spain, countries that produce the maximum riders. The indomitable Valentino Rossi, one of the most successful motorcycle racers of all time, who rides for Yamaha in the Moto GP, the 1,000-cc class championship, is an Italian.
Other indigenous players, too, have gone in search of racing glory. Hero entered by picking up nearly 50 per cent stake in US-based motorcycle sport company, Eric Buell Racing. It not only got access to high-end technology but also brand exposure in the AMA Pro Road Racing Championship.
Bajaj holds nearly 50 per cent stake in the Austria-based KTM, the leading constructor in the Moto3 championship. TVS Motor Company is known for its participation in the local circuit.
Scooter revival
Mahindra will also shake up its scooter portfolio. It will access product technology of the French Peugeot Motorcycles that it bought a 51-per-cent stake in last year, and tap its European market.
Peugeot has 13 product lines, seven engine capacities ranging from 50-cc to 400-cc and two manufacturing plants, including a joint venture in China. But Peugeot's entry price (at ¤1,200 or Rs 93,000) is much higher than those of Mahindra's (from Rs 33,760).
S P Shukla, president, group strategy and chief brand officer, says, "Peugeot was a perfect fit for us. It is an old brand and well-respected in Europe. It completes the three-way synergy of technology, branding and reach."
Peugeot could help it compete at home against scooter giant, Honda, which controls 55 per cent of the market, and other rivals such as Hero and TVS. It needs all the help it can get because its scooter sales in April-December, 2014, dropped by 28 per cent to 28,519 units even as the overall scooter segment grew by 27 per cent to 3.33 million units.
In December, it clocked a mere 4,100 scooter units, while Honda clocked 205,000 and Yamaha, the latest entrant, sold 15,600 units.
