Japanese super bike maker Kawasaki plans to strengthen its offerings further over the next one year by launching half-a-dozen models. For the Indian arm, 2015 was fruitful year as it launched few high powered super bikes including the H2. Shigeto Nishikawa, Deputy Managing Director, India Kawasaki Motors spoke to Bhargav TS on the company’s plans for the coming years and assembling 2000 bikes a year from its Pune facility. Edited excerpts:
Shigeto Nishikawa, Deputy Managing Director, India Kawasaki Motors Pvt Ltd
Q: How do you see the brand establishment of Kawasaki in India? What is your strategy to penetrate more in the market?
Nishikawa: The brand establishment is pretty good in the market. Strategy-wise I would like to mesh on the ongoing one. A month over since its launch, time to delve on the acceptability of the same from the customer’s end. With the customer quality being secured, we would like to have deeper insights on how fast H2 reaches the market. On par with the quality we would like to give weight-age to customer satisfaction too. With the existing customer database, we are able to dash with lot of new customers as referrals. I realise that I have to cover very wide area to attract many customers keeping our motives one down in the league with customer satisfaction leading us the rally.
Q: Will you be looking to assemble Kawasaki H2 in India?
Nishikawa: Assembling as of now is a million dollar question. Quality control parts and engine assembly are done in Japan manufacturing unit. Lot of technical training is needed for getting the assembly knowledge localised. Hence it will take a little more time to ingest the process in India.
Q: Do you highlight any chances of production or assembly done in Pune going forward?
Nishikawa: Currently there are 4 models getting assembled in India. As of now the roll out of CKD (completely knocked down) bikes from Pune plant is 1000 a year. We are expecting to increase the roll out to 2000 and soon this number would be realised.
Q: What is your driving growth in this segment and the profile of your customers?
Nishikawa: Indian market drives us more with the existing customers. We have set afloat the model Ninja 250, 5 years back and Ninja 650, 3-4 years back. We sensed that it is the right time to upgrade their models. The stored data give us an information on the bikes customers preferred. The bike data shows us the outflow of Kawasaki Ninja Z800, Kawasaki Ninja 1000 with CC variations. Hence the major profile of our customers get used to the kind of models i highlighted above and the strategy mentioned elsewhere would help us to penetrate more into the market.
Q: What is your current capacity and do you have plans to increase your capacity?
Nishikawa: The current capacity of Pune plant is 5000 and as I highlighted in the immediate past question the expected roll out is 2000 in an years time. So we do not have any plans to increase our capacity as we are already left with more capacity. Hence we are planning to increase the production lines to have maximum utilisation of the capacity.
Q: Do you have any cost savings in future which will be passed on to the customers?
Nishikawa: Local assembling leads to cost reduction and if produced locally this will still perk our benefits. Indian parts are already applied to our manufacturing. As of now the chronology before it reaches the target country would be Thailand and Japan. From Thailand, the parts hit the Japan’s manufacturing unit and getting consolidated over there and reaches the target country as a CKD. But when we target Indian suppliers the landed cost will be reduced and this cost could be transferred to MRP. With Ninja H2 model it would take time to realise this.
Q: The cost of the H2 is around Rs 29 lakh. What is the percentage of price reduction when you start localising the same?
Nishikawa: The import duty is the main portion at this point of time we incur. The assembly of CKD kit in India is almost impossible at this moment. The engine assembly is a herculean task and no other go we pay 75% import excise duty for CBU (completely built unit). On the other hand if we import as CKD kit we incur only 10% excise. Therefore around 65% of import duty will be saved if it is localised.
Q: As India being price sensitive market how would you manage this cost in the country?
Nishikawa: Considering the features, knowledge and techniques applied to the model price quoted is not too expensive. Putting cost factor in the spotlight we could not compromise on the quality and cheat the customer. No clue on the fellow contestants variants’ floating price in the market but we would not be able to promise on price reduction at this point of time.
Q: From India, how many parts you export?
Nishikawa: As of now we could say 20-30 parts are procured in India and getting exported. The description of the parts include shock absorbers, headlight, blinker, tail lamps, gears and switches. These parts are procured from India and getting exported to the countries like Thailand, Indonesia and Japan wherever the unit is manufactured and assembled. All the parts we export could not be taken forward as we have the evaluation bay which scrutinises the parts before it is fitted in the vehicles.
Q: How do you see Indian suppliers in terms of quality?
Nishikawa: There are many suppliers who are supplying very good quality products and the supply is also seamless as they have the capacity in-line with our demands. On the other hand there are some vendors whose production quality drops very easily and based on our inputs some suppliers recover but some shows complacent attitude. Hence lot of fluctuations at this point of time and it is too early to comment on Indian suppliers.
Q: Currently you have the radius of your facility shared by fellow players like Bajaj and KTM. Is there a probability you would source your parts from the same suppliers from whom they source?
Nishikawa: The description of the products do not match. Yes there are suppliers who supply to all of us but the components we source from them would not be the same. If a supplier supplies product A to Bajaj, from the same supplier We would procure product B. Hence we are looking for different needs.
Q: What are the plans for localisation?
Nishikawa: This terminology will be considered with the supplier quality in-line with our standards. The supplier products will be evaluated in the Japanese manufacturing unit and if it waves the green signal for the products then this terminology on papers will soon be on the live.
Q: On the servicing point, do you have modern garages or Bajaj will support you on this?
Nishikawa: Not only these bikes other CBU bikes are also serviced through Kawasaki dealers only. We have a norm that every Kawasaki dealer should have the service centre with the required infrastructure. As customers are very busy they might not be able to afford time for bringing the bikes to the service centre. Hence we instruct the dealers to engage a person for going to the customers’ premises, fix the issue if the same is minor or bring the bike to the service area and sort the same. Only the spare parts of CKD models will be serviced through Bajaj.
Q: What are the lightweight initiatives you have taken and how it increases the performance?
Nishikawa: It is very obvious that the heat managing system of the bikes is very effective and inter cooler is not needed. This advantage enables the model to have more space and reduces vehicle weight and we term the vehicle as super charged engine vehicle. With the light weight the fuel efficiency is increased and the performance is also commendable.
Q: There are lot of luxury brands which supply merchandise with the bikes. Where do you stand in terms of the same?
Nishikawa: Merchandise definitely has a place in my strategy. Customers will be very proud and satisfied with the offer of merchandise. Already we have tied up with few suppliers who make jackets and trousers. We are not left behind with this strategy.
