Last week we highlighted the damage that the lockdown is doing in the world’s largest motorcycle market India. Consolidation and mergers are to be expected I wrote then.
This week, news broke that TVS Motor is taking over British motorcycle brand Norton, in a bid to take on Royal Enfield which is one of the dominating brands in the ‘classic’ segment.
TVS’ move to buy Norton is not just a play on the Indian market, but also a move on the EU and UK markets, where larger motorcycles are a big part of total sales.
TVS disclosed that it bought Norton’s entire holding company for a sum of GBP 16 million (almost U.S. $20M), promising that it would restore the operational continuity for the troubled British bikemaker as soon as possible.
TVS Managing Director Sudarshan Venu said “We are retaining all employees. The brand will continue to hold its distinct identity and we plan to restore Norton’s glory and build upon it,”
The Norton takeover could be a smart move from TVS, which is currently a very active player in the smaller motorcycle segment. The Indian brand looks to use Norton’s technical know-how to make bigger drivetrains to jump into the 251cc to 800cc market which is currently being dominated by Royal Enfield’s Interceptor and Himalayan models.
With Norton, TVS will be aiming at the roughly 1 million Royal Enfield riders, and at a growing segment of the up and coming Indian middle class who’re looking to upgrade their 200cc rides.
TVS Motor’s acquisition isn’t its first foreign venture, the Chennai-based company already has a technical arrangement with BMW Motorrad wherein it makes 310cc bikes branded under BMW and it’s own Apache brands.