India finds an interesting mention in Yamaha Motor Co’s medium-term management plan (2022-2024) presented in Japan on February 10. “In the area of mobility services, we will establish new companies in India and Nigeria, and expand our asset management business through collaborations with local partners.”
Yamaha India gets into mobility solutions
The significance of this statement is still not clear, though a press release issued more recently refers to Moto Business Service India (MBSI), a mobility solutions company, whose stakeholders include Japan’s Yamaha Motor Co and Yamaha Motor Biz Partner Co.
MBSI has invested in Royal Brothers, a bike rental company, where it will procure new two-wheelers and deploy them on a revenue sharing basis model. MBSI will also work with companies keen on deploying electric two- and three-wheelers.
Whether these two news announcements are linked is a moot point, but the fact remains that Yamaha is more than keen to grow its presence in India through a host of business models that go beyond ownership options alone. The delivery business is only a natural entry point because this is where all the action is taking place, especially with a host of start-ups keen on making their mark.
Not everyone can afford to buy a two-wheeler and would rather rent them instead. This is where MBSI’s mission to “increase the usage of vehicles on shared/rental plat-forms” becomes relevant.
Yamaha India targets premium sport models sales growth
Getting back to its midterm plan, Yamaha has said that its main task is to improve profitability by continuing with the premium segment strategy in markets where demand is recovering. While total demand in Asia has still not fully returned to where it was in 2019 before the pandemic, the new plan will accelerate efforts in preparation for a recovery.
“In ASEAN markets and in India, we will target the upper-middle class, which is expected to grow rapidly over the next 10 years, and ramp up our premium segment strategy even more than before to solidify our advantages,” the company has stated in its presentation of the 2022-2024 plan.
In India, Yamaha will aim to double the number of premium sport models sold and “roughly double” the number of Blue Square premium dealerships which serve as “real points of contact” with customers.
Yamaha e-bike market plans
Clearly, Yamaha believes the customer pool for its premium bikes and scooters will grow, which explains why it is hopeful of doubling numbers in India by 2024, as articulated in its midterm plan. The midterm plan also makes a reference to the “prolonged global COVID-19 pandemic” which has changed people’s attitudes about travel and movement and triggered a shift in preferences to staying “closer to home and avoiding crowded spaces”. This has resulted in a spike in demand for small personal mobility.
“With this being the case and also due in part to a growing preference for more eco-friendly means, the e-bike market in Japan, the US and Europe is growing at an annual rate of 18 percent.” Yamaha believes that the product segment will continue to grow at this pace as “we head toward 2030”.
Hence, projections for these principal markets are “for a scale exceeding 10 million units by 2024” and the company will aim to expand its business scale at a “rate that outpaces the market’s growth” and double net sales by offering clients customised e-kits and new brand models.
There is no mention of India where Yamaha tied up with Hero Cycles for e-bicycles in late-2019. This is a growing market, and it will be interesting to see how the bonding grows between the partners.