Polaris Industries Inc. is a U.S based firm that specializes in both snowmobiles and off-road vehicles and has also established a presence in the global motorcycle market with brands like Victory and Indian. At the recent 2012 Auto Expo held in New Delhi the company officially announced its entry into the Indian off-road market. Even though the off-road market has not taken its proper shape yet, the company did not hesitate while launching two of its products in the Indian market, the Sportsman 90 and Ranger RZR 170.
Recently this US based maker has entered a joint venture with Eicher Motors Limited, India’s leading manufacturer of commercial vehicles and motorcycles. As per the agreement signed between both the majors, each of them will have control over 50 percent of the shares. There are a couple of facts about Eicher that made it the perfect choice for this venture.
image – Eicher Motors Limited CEO and Managing Director Siddhartha Lal (left) and Polaris Industries Inc. CEO Scott Wine (right)
First and foremost Eicher is a well established firm. Secondly it owns the iconic Royal Enfield motorcycle brand and thirdly it partly owns VE Commercial Vehicles Limited: a 50/50 venture between Eicher and Volvo. Established in 2008, VECV not only manufactures medium to heavy duty trucks and buses but also manufactures engineering components and provides engineering design solutions. Eicher’s dealership network is also well spread across the country at more than 400 locations.
Scott Wine, Polaris CEO said,
“This agreement instantly expands and enhances Polaris’ presence in India and supplying access to additional emerging markets around the globe and leverages Polaris’ strength in product innovation and vehicle development. Eicher’s financial strength and rich history as a leader in the Indian market makes them the perfect partner for Polaris in India. This joint venture represents an incredible opportunity to develop new vehicles and realize global growth.”
Commenting on the joint venture, Mr Siddhartha Lal, Managing Director & CEO, Eicher Motors Limited said,
“At Eicher Motors Ltd., we are committed to exploring and pursuing opportunities for long term profitable growth and value creation for our stakeholders. This joint venture with Polaris is a strategic initiative towards that direction. Currently, we are present in the commercial vehicle and motorcycle categories. The collaboration with Polaris Industries Inc. will allow us to enter into a new vehicle segment.”
Both the manufacturers have their own unique strengths which they will share with each other in the coming years. While Polaris is known for its innovations and design, Eicher is no less as it has excelled in powertrain manufacturing, it has good knowledge about the local markets and can build good products keeping in mind the price consciousness. In short both the manufacturers seem to complement each other.
As per the report both the companies are expected to spend close to $50 million (Rs. 250 Crore) over a span of three years. As of yet no strategies have been developed and the company is also looking for greenfield land to set up a facility. The production is expected to begin by year 2015.