Project Management

Assignment

Launch of RE 60 by BAJAJ Auto

Submitted to: Dr. Vinay Joshi

Submitted by: Deepak Sethi (PGDM 2010-12) Date: 10/04/2012

INTRODUCTION
Bajaj Auto Limited is an Indian motorized vehicle-producing company. Bajaj Auto is a part of Bajaj Group. Its founded by Jamnalal Bajaj at Rajasthan in the 1930s. It is based in Pune, Maharashtra, with plants in Chakan (Pune), Waluj (near Aurangabad) and Pantnagar in Uttaranchal. The oldest plant at Akurdi (Pune) now houses the R&D centre ahead. Bajaj Auto manufactures and exports automobiles, scooters, motorcycles and the auto rickshaw. The Forbes Global 2000 list for the year 2005 ranked Bajaj Auto at 1,946. It features at 1639 in Forbes 2011 list. Over the last decade, the company has successfully changed its image from a scooter manufacturer to a two-wheeler manufacturer. Its product range encompasses scooterettes, scooters and motorcycles. Its real growth in numbers has come in the last four years after successful introduction of a few models in the motorcycle segment. The company is headed by Rahul Bajaj who is worth more than US$1.5 billion. Bajaj Auto came into existence on 29 November 1945 as M/s Bachraj Trading Corporation Private Limited. It started off by selling imported two- and three-wheelers in India. In 1959, it obtained license from the Government of India to manufacture two- and three-wheelers and it went public in 1960. In 1970, it rolled out its 100,000th vehicle. In 1977, it managed to produce and sell 100,000 vehicles in a single financial year. In 1985, it started producing at Waluj near Aurangabad. In 1986, it managed to produce and sell 500,000 vehicles in a single financial year. In 1995, it rolled out its ten millionth vehicles and produced and sold one million vehicles in a year. According to the authors of Globality: Competing with Everyone from Everywhere for Everything, Bajaj has grown operations in 50 countries by creating a line of value-formoney bikes targeted to the different preferences of entry-level buyers.

Products
Bajaj has made a number of motorcycles, scooters and cars. Motorcycles in current production are the XCD, Platina, Discover, Pulsar and Avenger. Bajaj also Distributes many motorcycles in India for other manufacturers, such as the Kawasaki Ninja 250R, the Ninja 650R and new for 2012, the KTM Duke 200. Cars include the Bajaj ULC ultra-low-cost car.

Low Cost Cars

In 2010, Bajaj Auto announced the cooperation with Renault and Nissan Motor to develop of a US$ 2,500 car, aiming at a fuel-efficiency of 30 kilometres per litre (85 mpg-imp; 71 mpg-US) (3.3 L/100 km), or twice an average small car, and carbon dioxide emissions of 100 g/km. On 3 January 2012, Bajaj auto unveiled the Bajaj RE60, a mini car for intra-city urban transportation. The target customer group will be Bajaj's three-wheeler customers. According to Managing Director Rajiv Bajaj, the Bajaj RE60 powered by a new 200 cc rear mounted petrol engine will have a top speed of 70 kilometres per hour (43 mph), a mileage of 35 kilometres per litre (99 mpg-imp; 82 mpg-US) and carbon dioxide emissions of 60 g/km.

BAJAJ RE 60
Bajaj Auto is known to be pioneer of scooters & motor bikes in India. Bajaj Auto on 3rd Jan launched its first budget car in the Indian market. This 200 cc car called RE60 would compete with Tata Nano in its segment. RE60 by Bajaj auto is being introduced in the market with a joint collaboration of Nissan, Renault & Bajaj Auto. Bajaj Auto's RE60 is expected to have a top speed of 70kmph. Rajiv Bajaj group managing director of Bajaj expects RE60 to replace the current auto rickshaws & taxis in India. RE60 would give an average of about 35kmpl in normal driving conditions. RE60 weighs about 400Kg & the cost is expected to be around $2,770 (Rs 140,880) Bajaj Auto unveiled a mini four wheeler for intra-city urban transportation targeting three wheeler customers. The company, which had in 2008 showcased a concept small car but decided not to go ahead with the project, will launch the new product named RE60 later this year. "Certainly, this is a product, the core customers for which are those who use a three wheeler," Bajaj Auto Ltd (BAL) Managing Director Rajiv Bajaj told reporters here. He said the RE60, powered by a 200 cc rear mounted petrol engine could also be sold in overseas markets where BAL's three wheelers are exported."This vehicle has been designed for intra-city passenger transport keeping in mind intra-city duty cycles and safety requirements," he added. As per an agreement with the Renault-Nissan alliance, BAL was supposed to develop and manufacture the vehicle and sold under the badge of the alliance. In January, 2008 BAL had unveiled its concept passenger car with an expected price of USD 3000. It had partnered Renault-Nissan for the ultra low cost (ULC) car project. The ULC was first scheduled to hit the roads in India in 2011, but was delayed due to differences between the partners on pricing and design. While Renault-Nissan wanted to price the car at around $2,500, Bajaj insisted on lowering the overall cost of ownership. In 2010, Renault-Nissan announced the signing of a memorandum of understanding with Bajaj Auto to take forward their ULC car project.

RE 60 SPECIFICATIONS

Vehicle Summary
Name Model Car Body Type Segment Top Speed Fuel Consumption (highway) Fuel Consumption (city) RE 60 Small car 1+3, 2+2 Hatchback A segment 70 35 kmpl 24 kmpl

Verdict
For Against Price Looks features

Engine Specifications
Displacement Engine Type Maximum Power Maximum Torque Four-valve DTSi Petrol 20bhp (expected) NA

Dimensions
Length Weight Height 2752 mm 1312 mm 1650 mm

OTHER SPECIFICATIONS
Seating Capacity: Tyre Size: Suspension: Turning Circle: Boot Space: Steering: Brakes: Gears: Kerb Weight: Body Color Bumpers: Tachometer: Alloys: ORVM Indicator: Xenon Headlamps: Trip Meter: Headlamp Washer: 2 4 0 NA 3.50 mtrs. 44.00 ltrs. No Power Steering Front Disk, Rear Drum 4 Manual 400.00 kgs.

DEVELOPMENT

Of RE 60

Bajaj Auto spent nearly four years in developing the RE60, which has a top speed of 70kmph, the RE60 sports a rear-mounted 200cc petrol engine, boasts a mileage of 35 km to a litre of petrol and low carbon dioxide emission (60gm/km). "We are very excited with the outcome of our efforts and, in the RE60, we believe we have an excellent solution for the mobility challenges arising from the rapid urbanization of India," Rajiv Bajaj said. The vehicle, which has a seating capacity of four (2+2 or 1+3), may also attract individual buyers at the lower end of the market. But it is not clear how strong a competitor it can be to the Tata Nano that has a more powerful 623cc engine. Though the company is tight-lipped about the pricing, it could be around that of a threewheeler. A three-wheeler powered by 150cc engines costs under Rs 1.5 lakh. But while the RE60 is a vehicle that has commercial application in passenger transport, Bajaj appears to have moved away from the initial plan of developing an ultra low-cost car in partnership with Renault-Nissan.

CONCEPT BEHIND RE 60
A last mile people mover it might be for the commercial aspect of it all, rickshaws and taxis in more explicit terms but there is no denying that it is also built to the emerging new quadracycle norms for basic city commuting in Europe which call for cars of a specific design and strength, high fuel efficiency and ultra low emissions in the very essence of the term, decent performance for four with ease of use and control, all weather protection that is not pared to the bone but more in sync with the A-segment cars. And to top it all, this is a car with very strong fundamentals with all-Indian tech which is already a proven world beater in the two-wheeled sphere

ANALYSIS

&

STRATEGY

Why Name RE?

It is part of Bajaj Autos product strategy where the products define the brand and the firm has made this distinct with its motorcycle business completely. The Pulsar is the flagship range and brand of premium sports motorcycles; the Discover range is the brand of stylish and high tech mass market commuters while the Boxer series is the utilitarian, rugged and no-nonsense range of entry level motorcycles across the low price but heavy duty usage areas. In the same vein, there is now not much of Bajaj Auto branding on these machines but the fact that Pulsar, Discover and Boxer acquire the same generic thrust as say Chevrolet, Cadillac and Buick perform for General Motors. In the three-wheeled space, RE remains the most known and successful brand among all Indian three-wheelers and this stems from the smooth operating performance of the RE (rear engine) three-wheelers. As such RE will remain the brand for all Bajaj Auto offerings having more than two-wheels and with rear-engines

Target Audience
Bajaj said the company wanted to target the three-wheeler segment in India, while also looking for opportunities overseas. "We make about 5.20 lakh three-wheelers a year of which only 2 lakh is sold in India and the rest exported. So we see markets like Sri Lanka, which could be the first export market, as having huge potential for RE60." Executives say they have no plans to market it to average consumers. Instead, they are aiming for drivers of rickshaws, which are powered by motorcycle engines and operate as shortdistance taxis in India. The RE60 offers features not found on current rickshaw models, including seat belts, doors and a hard top. It will have windows, although ones that fold out rather than roll down. The company did not say how much the RE60 would cost when it hit showrooms this year. But a rickshaw costs about 120,000 rupees, or $2,200, and one auto analyst estimated that the RE60 would be priced 25 percent higher than that, or about $2,750. But the RE60 was expected to be more than a souped-up rickshaw. It was widely anticipated as Bajaj's answer to the Tata Nano. The Nano, which its maker Tata Motors introduced in 2009, was billed as a people's car that would bring mobility to India's masses. It sells for a list price of about $2,600. "At Bajaj Auto, we believe the people of this planet deserve much better, much faster," Rajiv Bajaj, the managing director of the company said in a statement, in what appeared to be a notso-subtle dig at the Nano. "We, therefore, decided to focus our efforts on developing vehicles powered by engines using available natural resources and infrastructure."

Why BAJAJ RE 60 is not a CAR?

The company that introduced it, Bajaj Auto, best known for making motorcycles and motorized three-wheeled rickshaws, does not even call its newest product, the RE60, a car.

Auto's MD claims that his firm's new RE60 micro-vehicle is a four-wheeler, not a car. There is logic behind Bajaj's statement: he wants two- and three-wheeler customers in his two largest markets, India and Sri Lanka, to view the RE60 as their next step up. The company that he leads sells over half a million scooters, motorbikes and auto-rickshaws annually in the home market alone, which is big business in anyone's language. Bajaj was on course to sell over 200,000 RE two-wheelers in India during 2011 so you can suddenly see the thinking behind the new car, sorry, four-wheeler's model name. The vehicle architecture has reportedly been developed from that of a three-wheeler and therein lays a big clue as to aspirations that Bajaj has for the RE60.

Is TATA NANO a competitor?

This is a four-wheeler built by the worlds largest manufacturer of three-wheelers used primarily as last mile people movers. The engineering is frugal but not at the cost of structural integrity, the thought behind the design is smart but not cocky and the overall tenets to drive home the point of light weight and optimum power-to-weight has resulted in a car which can and will perform adequately as an urban runabout for four with all-weather protection. The analyst, Hormazd Sorabjee, said the RE60 would pose no challenge to the Nano, which itself had attracted only a fraction of the buyers for which Tata had hoped because of production delays and safety concerns.

Comparison with Maruti 800

Specification Engine Tata Nano Maruti Suzuki 800

NANO
Bajaj RE60 Twin

and

624 cc, 2 cylinder,4 stroke cycle, 796 ccDigital

Spark

MPFI Engine

water cooled SOHCTech 200 cc engine engine 37 bhp at 5000 rpm 20 bhp (expected) N/A

Power Torque

37 bhp at 5500 rpm

51 Nm at 4000-450059 Nm at 2500 rpm rpm

Brakes

180 mm diameterFront: Disc brakes,Front: Disc brakes, Drum brakes (FrontRear: Drum brakes Rear: Drum brakes and Rear) 4m 4 600-635 kg 105 kmph 4.4m 5 665.00 kg 144 kmph 3.50m 4 400.00 kg 70 kmph

Turning Circle Seating Capacity Kerb weight Top Speed

CONCLUSION
Bajaj Auto has made a foray into unchartered territory with the RE60, which as of today is the most cost effective, cleanest and most fuel-efficient vehicle on the planet. Some may refer to it as a small car; however it does enough to break away from what we would term as a conventional car to be something unique and totally different. The RE60 boasts innovation in design and functionality and unravelling this unique four-wheeler concept, already signed off for series production, in exacting detail is ZigWheels' Editor-in-Chief Adil Jal Darukhanawala. There are two radical directions that the RE60 - a name that harks back to Bajaj Auto's range of Rear-Engine autorickshaws - pushes the boundaries of engineering and market positioning. It is a new advancement in last mile people movers on one hand, and a modern rethought urban mobility solution on the other.
Bajaj auto is an Apple kind of company. They believe in making niche products; they are an 'anti car' company. They are 2, 3 and 4 wheeler company and in this space, their investment can't be anywhere near a car company.

There are claimed to be an astonishing five million three-wheeled vehicles on India's roads. No doubt he can see a huge business opportunity there, especially if legislation is passed that would force operators to replace them with a safer, closed-cabin alternative.

REVIEW
User opinion for BAJAJ RE 60 during January launch shows statistics as: 1225 Like it 670 Hate it Popularity 1st week of JAN Popularity all time : 1,060 views : 3,58,189 views