BMW to Partner with India’s TVS Motor Company

BMW is getting closer to signing a partnership agreement with India’s TVS Motor Company. The partnership, expected to be finalized before the end of March, would see TVS receive access to BMW technology while the German manufacturer would increase its footprint in the world’s second most-populated nation.

TVS is one of India’s largest manufacturers but it has recently slipped to fourth from third behind Hero MotoCorp, Bajaj Auto and Honda. An injection of BMW technology may be what TVS needs to regain its market share. TVS’ competitors all either have links to foreign motorcycle manufacturers.

Hero MotoCorp recently ended its long partnership with Honda and is now working with Erik Buell Racing to develop new products. Bajaj owns a 47% stake in KTM and has begun introducing models that share components with similar KTM motorcycles, such as the Bajaj Pulsar 200ns which is based on the KTM 200 Duke. Baja also has a separate deal with Kawasaki which helps draw additional visitors to its showrooms. And Honda is, of course, Honda, with its own wholly-owned subsidiary recently surpassing TVS as India’s third largest motorcycle producer.

TVS used to have a foreign partner in Suzuki but the two brands ended its 19-year relationship in 2001. Since then, TVS has carved out a significant chunk of the Indian two-wheeler market, thanks in large part to its sub-100cc mopeds. The Indian market is maturing however, and the appetite for small displacement commuters is getting replaced with a hunger for larger premium models.

Pictured above is the Phoenix 125, TVS’ new premium model which competes against such models as the Hero Glamour, Bajaj Discover, Honda Shine and the Yamaha SS125.

For BMW, a potential partnership with TVS would vastly improve its standing in India. At the moment, BMW only has dealerships three dealerships, but a deal with TVS could provide access to more showrooms across the country. BMW could also work with some of TVS’ production facilities to assemble complete knockdown kits to take advantage of lower tariffs and thus, reduce prices.

[Source: Hindu Business Line, Wall Street Journal]

By Dennis Chung