Moneycontrol
Last Updated : Jul 25, 2018 12:36 PM IST | Source: Moneycontrol.com

Bajaj Auto to start selling Qute in Kerala, North East from next month

Bajaj Auto dealers in Kerala and in the North East have already placed orders for the four-wheeler as it is 'technically' possible to sell the Qute there

Swaraj Baggonkar @swarajsb
 
 
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After being mired in controversy for more than six years, Bajaj Auto's Qute will finally be made available for sale next month, with the company already having started deliveries of the quadricycle to dealers.

Bajaj Auto dealers in Kerala and in the North East have already placed orders for the four-wheeler as it is 'technically' possible to offer the Qute for sale in these markets, the company said.

"Permission of the Qute have come through and we will start in the next few days. Technically Kerala is allowed to retail it so the initial plan is to send out 35-40 vehicles to all the dealerships so that registration process can be completed. But I would say that retails in the North-East and Kerala should commence next month," said Kevin D’sa, President (Finance), Bajaj Auto.

Qute, which is a four-wheeler, comes under a new category of vehicle. It is not classified as a personal vehicle and can be used only for commercial purposes.

This means that the vehicle will need clearance from individual state governments. As of now, only Kerala and the North Eastern states have given their go-ahead.

Early last month, the central government cleared the policy to permit quadricycles for commercial use, after the Supreme Court asked the Centre to look into the matter.

Several public interest litigations (PILs) were filed by various entities to stall the commercial launch of the quadricycle.

"The Qute is launched with the idea that as and when a transition (from three-wheelers) takes place we are well prepared for it. Qute also offers itself to make it into an electric vehicle," D'sa said.

"Right now we are looking at as an addition to the existing three-wheeler. For instance the South Mumbai area can become a huge opportunity if Qute is allowed on sale. We are looking at it as a complementary vehicle rather than a substitute vehicle," he said.

Unable to sell the vehicle in India, Bajaj started exporting the Qute to Latin America, Europe and Africa in 2015. The vehicle is powered by a five-speed, 216cc engine that develops a peak power of 13.2 PS and has a maximum speed of 70 kmph. It can seat three passengers and a  driver.

Bajaj has created a capacity of 60,000 units per year for the Qute at its manufacturing facility in Aurangabad. According to D’sa, the production capacities for three-wheelers can be used to produce the Qute as well.

The quadricycle is part of a new category of vehicles recognized by the government a few years ago.

Several companies including TVS Motor Company and Tata Motors had opposed the government's proposal to allow quadricycles to be sold in the market on the grounds that the vehicle does not meet crash safety norms.

Company capex

Bajaj Auto has lined up about Rs 300 crore of capital expenditure for the current financial year, which is largely in line with its usual capex plans from earlier years. But the company sees an increase in spending from the next financial year for a period of three years.

"In a normal year we see a capital expenditure of Rs 250-300 crore. The plan for 2018-19 would be of Rs 300 crore but with the production run rate of 5 million units there will be a requirement for additional capex for building up of capacity. Most of the capacity build up is done by the vendors and very little is done internally. From 2019-20 onwards, for 2-3 years, the capex could be the range of Rs 500 crore," D’sa said.
First Published on Jul 25, 2018 12:36 pm
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