We are targeting the mass market: Hiroyuki Yanagi, President and CEO of Yamaha Motor

It was touted as the $500 motorcycle for India when Yamaha first announced its plans to manufacture an affordable commuter.

Hiroyuki Yanagi, global President and CEO, was quick to clarify what the real objective us. “The cheapest bike is not our goal and there seems to be some misunderstanding.

We try to make good products for customers, which includes performance and values,” he said during a visit to India in 2013.

Last month saw the secret finally revealed in the form of the 110cc Saluto RX which was launched at a little over ₹46,000. Clearly, its price is way beyond the $500 mark which Yamaha officials say was a ‘theoretical figure’ in the first place. The bigger goal was to try and work within a certain costing framework while retaining the Yamaha DNA.

All-new platform

This was in perfect sync with what Yanagi had said three years ago about this project codenamed Indra (Innovative and New Development based on Responsible Analysis). Beyond costs, he reiterated that Yamaha would also focus on styling, performance and safety.

The motorcycle will be positioned as an economical and practical commuter bike in a product category which accounts for a lion’s share of sales. The ‘RX’ suffix is intended to create brand recall of the company’s top-selling bike decades earlier while the Saluto brand (the 125cc sibling was launched last year) defines the segment it is targeted at. The Saluto RX has been created on an all-new platform and it is extremely likely that less expensive options could be considered for markets like Africa. Yamaha has already made known that it is eyeing future growth in this part of the world.

Project Indra had teams from India and Japan working together to make a bike which would assure the optimal mix of excitement, affordability, fuel efficiency and performance.

The idea was to give Indian customers the best set of ingredients in the motorcycle arena.

Suppliers played a big role in the creation of the Saluto RX and this was unlike the past where any bike was typically developed based on Yamaha’s drawings. This time around, there was greater participation from the vendor community even before fixing the drawing standards and specifications.

This first-of-a-kind team effort ensured that suppliers contributed to ideas and worked on specifications for parts. In short, they were critical partners in Project Indra.

Today, as the Saluto RX endeavours to build a footprint in India, there is a tremendous level of satisfaction within the Yamaha family.

What is equally significant is that the Chennai plant which is home to the Saluto RX is the first of its kind for Yamaha in terms of a vendor park.

The entire ecosystem plays a big role in keeping costs under control and the facility will be a powerhouse for supply of parts worldwide.

Yamaha has already identified India as one of the four regions for global procurement of parts with the others being Japan, China and ASEAN.

In an email interview, Hiroyuki Yanagi, President and CEO of Yamaha Motor, says India’s role will grow in the coming years.

How important is India in Yamaha's new medium-term management plan?

The Indian two-wheeler market is growing very strongly and sold over 16 million units last year. It is also the largest in the world and we forecast two-wheeler demand to be 19 million units in 2018.  India is positioned as one of the most important countries for our business. In our medium-term management plan, we are planning to achieve 1.2 million units in 2018. We are targeting the mass market under three main strategies: first, launching emerging-market strategy models; second, improving sales network quantity and quality; and third, strengthening customer contact point.

Will you also look at India for marine solutions going forward?

First of all, we aim to spread outboard motor in the fishing industry. I expect leisure usage would increase in the future.

The last time we met at the Tokyo Motor Show, you had spoken of Yamaha aiming to be a personal mobility company. Will emerging markets be part of this vision?

Personal mobility will not only spread in developed countries, but also emerging countries. Even if the current market mainly needs two-wheelers, varying mobility solutions including four-wheelers would spread out the market. We will continue developing unique mobility to rev your heart.

Could you elaborate on India’s role to strengthen brand Yamaha globally?

The Indian Integrated Development Centre commenced operations since 2013.  With the goal of high local development, we are accelerating our engineering, manufacturing, and marketing with lower costs and at local market quality standards, to support our product competitiveness both within the Indian market and for exports.

Will we also see more R&D work happening out of India?

Approximately 250 engineers including purchase engineers are working for value development. "Value" means the balance between function and cost. India R&D aims to develop not only higher specification but also low cost with good balance for the market. For this aim, India R&D will carry out "develop", "purchase" and "cost innovation".

What is your outlook for the ASEAN region?

Even if the market is tough during the short-term period, I expect ASEAN, including Indonesia, to recover in the mid-term period.

Will the remainder of this decade be challenging for the two-wheeler industry?

The two-wheeler market is a growing industry and even if some countries are showing a recovery trend, others need time to recover. In view of a long-term period, there are potential markets such as Africa to grow business.

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