Cycle News is a weekly magazine that covers all aspects of motorcycling including Supercross, Motocross and MotoGP as well as new motorcycles
Issue link: https://magazine.cyclenews.com/i/745221
IN THE WIND P32 T he ongoing revival of Brit- ain's historic motorcycle brands has saved the biggest and maybe the best for last, with the rights to the dormant BSA brand purchased by India's $17.8 billion industrial conglomerate Mahindra Group, one of the top 20 companies in India's Fortune 500 index. India's largest SUV and utility vehicle manufacturer, Mahindra has a global workforce of over 200,000 people in over 100 countries, and is the world's largest maker of tractors, which it even builds in China. In 2008 Mahindra expanded into the two-wheeled sector by spending $17 million in pur- chasing Kinetic, a small Indian scooter manufacturer which had acquired the rights to most products of the defunct Italian scooter company Italjet. Mahin- dra has since invested upwards of $200 million in Mahindra Two Wheelers/MTW, including the construction of a state-of-the-art factory with an annual produc- tion capacity of 500,000 units. Yet seven years on MTW is easily the smallest of India's five indigenous manufacturers (behind Hero, TVS, Bajaj and Royal Enfield), with just 150,927 units sold in 2015, according to official figures. That's a massive 22.4% fall year on year, and a drop in the ocean compared to MAHINDRA BUYS BSA Hero's 6,296,920 units sold in 2015, while the overall Indian industry—the world's second largest—posted a 1.2% growth in volume to 15,404,026 units in the same period. MTW has yet to post a profit since its foundation, and by this April had posted accumulated losses of $148 million in gaining a mere 1% slice of the overall In- dian market. Time for a radical rethink, and the BSA acquisi- tion and Jawa licensing deal are just that. In a deal signed on October 20 with David Bennett, CEO of UK-based Regal Engineering, holder of the BSA trademark, Mahindra Group subsidiary Classic Legends Pvt. Ltd has acquired all 120,000 shares of BSA Co. Ltd. in a transaction totaling GBP 3.4 million. Classic Legends has also signed an ex- clusive brand license agreement for the Czech marque Jawa, but this is not an acquisition, merely the license to use the name in India. Two-stroke Jawas were built in India during 1960-1996, generating a cult local following, which persists even today, so the brand will be used exclusively for Indian customers. Acquiring BSA denotes Mahindra's intent to target premium sectors of the motorcycle business in export markets. That's because it cannot use the BSA trademark in India The India-based Mahindra Group has purchased one of Britain's most iconic brands—BSA.