Indian Scooter Maker Hopes Electric Models Will Help with Turnaround
Mumbai: Two-wheeler maker Kinetic Motor Co. Ltd hasn’t had much of a good run lately. It has been losing money since fiscal 2004 and sales have dropped 9.4% in the last two years even as rivals have ramped up revenues and profits. Investors who pushed the Sensex, the benchmark index of the Bombay Stock Exchange (BSE), to a record have been lukewarm to its share and warmed to those of rivals such as Bajaj Auto Ltd and TVS Motor Co. Ltd.
Kinetic, which made its money and name in low motorized vehicles or mopeds such as the Luna back in 1972, rode on that success and formed Kinetic Honda Motor Ltd, then a joint venture with Honda Motor Co. Ltd to make scooters, and wowed women customers in the 1980s with gearless, or automatic, scooters. By the 1990s, though, competition began to creep in, Honda went its own way and the market started to move towards motorcycles. Honda’s joint venture with the Hero Group prevented Kinetic from making motorcycles then; it only started to make motorbikes on its own after cutting ties with Honda in 1998. When the bigger players started undercutting their prices, Kinetic was in deep trouble.
But the firm says it’s gearing up for change, by refocusing on what gave it success—the automatic scooter.
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