Bajaj Auto opens first-ever overseas facility in Brazil amid Exports Slump

Bajaj Auto, one of India’s leading exporters of motorcycles and three-wheelers, launched its first overseas manufacturing plant in Brazil. This setup was aided by its subsidiary Bajaj Do Brasil. With this initiative, Bajaj Auto aims to strengthen Bajaj’s position in Latin America’s largest 2-wheeler market by gaining insights into product development and consumer behavior. However, this comes with a challenge as Bajaj Auto’s exports slumped overseas.

Characteristics of the facility:

Bajaj Auto Limited started its first overseas manufacturing plant in Brazil. Spread over 9,600 square metres in the northeastern city of Manaus, the facility has a production capacity of 20,000 units per year on a single shift, according to a statement issued by the company. The production capacity of the facility can be expanded to 50,000 units per year. This can be done by setting up additional product lines. However, the company is initially focused on sourcing, assembling, and testing of the Dominar models. Its strategic location in Manaus leverages the substantial fiscal benefits offered by the State as well as proximity to supply chains and major transportation hubs, the company said. In addition to Bajaj models, the proposed Brazil facility will also produce the motorcycles of Austrian company KTM AG, in which Bajaj Auto has a 48% stake

Bajaj’s operational excellence:

The Brasil plant will mark the company’s first facility outside India. To date, the company sold vehicles in over 100 countries and followed a distribution-led model in which the distribution partners led the local operations. One of the major reasons for choosing this market was the positive feedback received by the Pulsar range of motorcycles sold as “Dominar” in the Latin American Market. The Dominar brand was launched just 18 months ago. This new setup will enable the manufacturer to build a wider distribution network and introduce new products. Bajaj Auto is India’s biggest exporter of two-wheelers.

Conclusion: The Brasil plant’s strategic location and high sales growth in Latin America have given confidence to the manufacturer even though its exports slumped. With the plant setup in Brazil, Bajaj Auto’s global footprint continues and customer franchise continues to grow.

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