If Bajaj sticks to its stand, we'll sue them for libel: TVS

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A day after Bajaj Auto hit out at TVS for alleged patent infringement, TVS has threatened to sue them for libel. But Bajaj is sticking to its stand. The patent battle between TVS and Bajaj is getting hotter.

HS Goindi , Senior Vice President TVS-Motors said that they are on track and will be in the market place by October end. As far as technology is concerned, it is different so they do not think about that at all.

Q: Why is this a big deal for TVS?

Sumantra Barooah: It would not have become such a big issue had it not been for the huge stakes involved in this whole controversy for both the parties. Bajaj Auto was the first to offer twin spark plug technology in two-wheeler engine in India, which they have branded as DTSi technology and this is a major selling point for its product. It started with the Pulsar then went to Discover and it has also gone into its first new age scooter called the Crystal. So it wants to protect that exclusivity that it has in the market place, which again is a major selling point for its products.

This is important for TVS because according to some industry observers, for TVS, "it is a major come back in the two-wheeler market", and they have unveiled four products on Thursday and the new fresh offensive will be led by the Flame 125 CC, which is the bike in question with that twin spark plug technology. I had a word with HS Goindi, Senior Vice President TVS-Motors and asked him could there be any delay in the commercial launch of Flame 125 if there is any possible legal action that Bajaj Auto could take?

Goindi: We are on track and we will be in the market place by October end. As far as our technology is concerned, it is different so we do not think about that at all.

Q: This technology of twin spark plug engine in a three-valve engine, you have got the license from AVL of Austria, are you planning to have this same technology in any other future products and will the current problem affect those future product expansion plans?

Goindi: There is no problem at all, even for the current product; the current product will be on the role at the particular time in October end. As far as the future products are concerned, we will be looking at the customer side first of all and see whether this technology is relevant for that particular customer side. If we find the technology to be relevant for the customer, we will definitely apply for it and then put that technology in a particular bike and if it is not relevant then we will not put it. So the answer to your question depends on what bikes we will make as far as a particular customer segment is concerned.

Q: Also, Bajaj Auto has stood by its stand that it may possibly take legal action against TVS Flame's engine technology. Will you still go ahead with your Rs 250 crore libel suit because in case Bajaj Auto retracts its statement you may think otherwise and not file the suit?

Goindi: If they stand by what they have done, we will definitely go ahead. If they will withdraw it, we will discuss that.

Q: Talking about the Flame, which is the bike in question with this twin spark plug technology, how important is a Flame 125 for TVS Motors' overall scheme of things currently?

Goindi: Flame 125 is as important as any new product would be for any company. It fulfills a particular portfolio and to that extent it is very important. Production is important for the company.

Q: Are you expecting it to arrest the significant fall in volumes, which TVS Motors has been witnessing over the past few months?

Goindi: Past few months, the drop in volume is because of many other reasons, which are economy related. This product is coming in a segment where we did not have a bike for the time being and hence we are putting up a good 125 CC bike in that particular segment and we will have about 35,000-40,000 numbers coming up in the next three-six months' time of this particular bike. What has not happened, why this fall has happened, there are so many other reasons like retail finance economy not working out in some places.

Barooah: The fight between Bajaj Auto and TVS Motor in the 125 CC segment has already started before their respective products hit the markets.

Q: If this snowball leads into a legal battle, it looks like it will, how will it impact Bajaj's scheme of things?

Swati Khandelwal: Bajaj officials have been saying that they will not postpone the launch of their bike, the Exceed 125 CC is to be launched on September 9. They say that the bike is going to be on schedule, they are preparing for a legal action against the TVS Motors on the DTSi technology on infringement of the patent IPR Act that they have picked up, but they have given no timeline as to when will they go to court. Clearly, they are waiting for a response from TVS on how will they use the technology on the bike and what will be the product finally.

So they are open to agreement and talks on how this can be sorted out. So no timeline on the legal battle as to when they will go to a court and file it.

Bajaj was granted this patent for Indian market or DTSi in July 2005, Bajaj says that TVS is asking for patent revocation itself acknowledges that they know that this patent is valid and does exist. Also what makes this case stronger for Bajaj here is the fact that Sri Lankan High Court had upheld Bajaj's DTSi patent when a Chinese manufacturer and a Sri Lankan distributor together made their version of Pulsar on the same technology front. So they are confident on winning, if at all this whole battle swings out. Another thing is that they are dwindling 100 CC segment and making way for 125 CC, all bike makers are eyeing that segment and betting big on it, both these companies have said in past that 125 CC is a segment is betting big on this clearly shows that they will have a little bit of a competition there and both these companies want a lot of technology focus and they will want to see how it flows.

But we will have to wait and watch and only time will tell us how this swings out.