Yamaha targets to sell 3 million units by 2020 in India

Left far behind in the world's second largest two-wheeler market despite being the first mover advantage Yamaha is desperate for a complete overhaul of its India operations. As part of its efforts to increase the 2 percent market share the company entered the scooter segment last week hoping to finally get gain a foothold in India. But will it be enough for Yamaha to finally get its India business rolling? Ronojoy Banerjee of CNBC-TV18 finds out.

Ten years after re-entering the Indian two-wheeler market following the break up of its joint venture agreement with Escorts in 2001, Japanese two wheeler giant Yamaha is yet to make any meaningful inroads despite having more than a handful of motorcycles in the 100 to 150cc segment.

Sensing now an opportunity in the scooter space, Yamaha launched the gearless 125cc scooter 'Ray' last week that would compete with Honda's Activa. The launch marks a dramatic shift in the company's strategy in India so far where the focus was largely on premium products.

Hiroyuki Yanagi, president and CEO, Yamaha Motor, says that for several years they were focused on the premium segment. "We have now entered the scooter segment our new scooter will give joyful life to young people. The first model is targetted at young women."

Though the entry into the scooter segment could be a tad too late for Yamaha it however stands to gain incremental volumes. That would be on account of the pro-scooter sentiments over the last many months. For instance in the fiscal so far while the motorcycle segment has grown at a tardy 3 percent, scooter sales have jumped by more than a fifth.

Similarly, the share of scooters to the overall two-wheeler segment has grown to 20 percent from a little over 17 percent in the April-August period last year, but will it be enough for Yamaha to achieve the 10- percent market share it has envisaged by 2020?

"We feel that by 2020 the overall two-wheeler market in India would be around 30 million units...and we are targeting about three million of those units...," said Yanagi.
 
While the odds may be against Yamaha, the entry into the scooter segment certainly marks a shift in approach offering a 'Ray' of hope for the Japanese giant.