Bajaj Auto working on 100cc version of Freedom CNG motorbike

Bajaj Auto is standing at the cusp of monthly sales of one lakh clean energy vehicles by this festive season

Bajaj Auto, which introduced the world’s first compressed gas-powered two-wheeler, is developing a 100cc motorcycle that can run on both petrol and CNG, according to people familiar with the development. The new model, to be built on the existing Freedom platform, will likely be priced between Rs 80,000 and Rs 85,000 (ex-showroom), the people said.

The proposed 100cc CNG motorcycle is aimed at helping Bajaj Auto chip away market share in the so-called commuter segment from Hero MotoCorp, whose models, such as Splendor+, priced at Rs 76,300 (ex-showroom Delhi), dominate the price-sensitive category, one of the people cited above said. "By introducing a bi-fuel variant in the 100cc segment, Bajaj Auto hopes to attract cost-conscious buyers looking to reduce their monthly fuel bills," the person said, requesting anonymity.

The person said that the commercial rollout of the 100cc version will likely occur in the next 4-5 quarters. This timeline is contingent upon the successful deployment of the Freedom 125 CNG across key cities with sufficient CNG-filling stations.

In July, Bajaj Auto launched the Freedom 125, the world’s first CNG bike, priced between Rs 95,000 and Rs 1.10 lakh (ex-showroom, Delhi). The model offers a claimed range of 200 km in CNG mode and 130 km in petrol mode, with a combined range of 330 km. Nearly 13,000 units of this model are booked.

As of August 26, the price of CNG in New Delhi is Rs 75.09 per kilogram, while petrol is priced at Rs 94.72 per litre.

A second person familiar with the matter said that Bajaj Auto plans to increase its monthly production capacity of the current CNG bike to 40,000 units by the end of the fiscal year. The production ramp up was confirmed by Rajiv Bajaj, Managing Director of Bajaj Auto, who stated that August was the first full month of production, likely at 8,000-9,000 bikes for the month. Bajaj anticipates that this figure could rise to as much as 20,000 Freedom 125 motorcycles by next month and may double soon from there.

"With increased production and the introduction of more variants, Bajaj Auto will be able to price its lower-spec CNG-driven motorcycle more aggressively, similar to its strategy with the Chetak e-scooter," he explained. The introduction of the 100cc variant will depend on the commercial success of the Freedom 125 CNG, the person added.

Another source said that the two-litre CNG tank used in the current 125cc Freedom model will also be used in the 100cc variant.

When contacted for a comment, a Bajaj Auto spokesperson declined to provide any information about these developments.

Rajiv Bajaj hinted that the Freedom brand would expand beyond a single CNG motorcycle to become a "portfolio of products." He also confirmed that there are no plans to introduce a second brand of CNG motorcycles shortly.

“We will stick with the Freedom brand and develop it just like we did with the Chetak as an electric scooter brand and the Pulsar as our sports motorcycle brand,” Bajaj told CNBC-TV in an exclusive interview last month. "From a platform that started with a 125cc model, we can certainly develop a 100cc or a 150cc variant. More motorcycles of different displacements and styles will be launched from the same platform every few months or once a year," he said.

In the recent interview with the same channel, Bajaj Auto confirmed that there will be a new variant of the 125cc model, though he didn’t mention whether it is a 100cc or 150cc.

During a post-Q1 earnings call, Bajaj Auto's Executive Director, Rakesh Sharma, highlighted the company’s intention to ramp up production of the Freedom model and explore additional variants. "Freedom is a platform that can be extended in both directions. However, we will introduce new variants based on market demand. It's not a ground-up effort; it's a platform, and we can quickly respond if there is a need in the marketplace," Sharma stated.

Industry analysts have pointed out that while building a 100cc CNG dual-fuel bike is technically feasible, there could be challenges in terms of techno-commercial viability.

Varun Baxi, Lead Analyst at Nirmal Bang Institutional Equities, explained, "We believe CNG two-wheelers are feasible only for the 125cc segment and above, as the desired performance would result in increased weight, making manoeuvrability difficult." He further noted, "While CNG technology could appeal to the cost-conscious entry and executive segments up to 125cc, factors such as limited CNG network coverage, high queuing time for refuelling, high initial acquisition cost, and lower performance will restrict its market penetration." Baxi added that CNG could be a game-changer in the African market, particularly for the taxi segment, where longer seating and lower running costs could boost sales.

S&P Global Mobility, an automotive intelligence firm, claims that the introduction of Ola electric bikes at aggressively low prices is poised to escalate competition within the two-wheeler segment.

"This development is likely to compel ICE (Internal Combustion Engine) manufacturers to provide more cost-efficient alternatives to attract consumers. One strategy might involve downsizing engine capacity (cc) to produce more affordable models, while another option could be to offer CNG variants. This stage could mark the final era for ICE vehicles in India as the market increasingly gravitates towards electrification," said Puneet Gupta, Director S&P Global Mobility.