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Eicher To Make ‘Personal’ Vehicles With Polaris

One surprising announcement was made yesterday regarding Eicher. Eicher will enter the personal vehicle segment with Polaris, a well-known ATV manufacturer across the globe, though what Eicher means by ‘Personal’ vehicles is still unclear. This is a 50:50 joint venture between Eicher and Polaris Industries, with an investment of Rs. 250 crore over the next three years to set up a plant in India. To explore the personal vehicle market is one of the main reasons for this joint venture, after success in the commercial vehicle market. Let us look at the two members of this JV.

We know Eicher as a quality truck manufacturer which pioneered fully built truck market in India and 50 percent owner of Royal Enfield. This image will be further developed and will get one more dimension of ‘Personal’ vehicle manufacturer. The other half, Polaris Industries, is a US based company, well known for its snowmobiles, all-terrain vehicles, electric vehicles and motorcycles. So these two companies coming together might look quite strange. But it makes sense as Eicher wants to expand its business and Polaris wants to establish themselves in emerging markets like India.

Officials from both sides chose to keep mum about what do they mean by ‘Personal’ vehicle. Also the product mix of both companies is quite different. It creates a cloud of confusion around the outcome of this JV. There are several possibilities about this, like car manufacturing; as many are speculating that they will be targeting small car business. This appears as a difficult task at their hand if we look at the investments they are planning to do and the expertise they are having. As others are saying if output of this JV is a small car which makes our pockets happy then we will surely welcome it.

Other alternative is ATV manufacturing, but in India people are not inclined towards activities which involve ATVs. But if we look deeply into the product mix and amount of investment (which is sufficient for setting up a 2-wheeler plant) they are planning to do, we speculate that the child of this JV will be big lifestyle motorcycles. The motorcycle can take forward the legacy of Royal Enfield. Considering the expanding market of big motorcycles, we speculate that by ‘Personal’ vehicles Eicher means seriously big motorcycles. Polaris owns Victory motorcycles. Could Eicher manufacture them locally?

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