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Bajaj has started its production on its low cost 125cc bike in China. The bike will come under “Boxer” brand name instead of Bajaj to make not to come under as a low cost bike manufacturer. The said bike will be retailed in China, Nigeria and some of Bajaj’s other exports markets. The company will also brand this vehicle under “Boxer” in India and might launch here by 2009-end or early 2010.

Bajaj’s low cost Boxer 125 might have a price tag around Rs 22000 to 24000. The company will initially manufacture around 20K units of Boxer 125 per annum at its plant in China. About 75% of the total production will be sold in Nigeria.

Bajaj is currently retailing the Platina 100 as a low cost bike in India added with a price tag around Rs 35000 (ex-showroom). Bajaj’s main competitor, Hero Honda also sells a bike in this segment – its CD Dawn is priced at Rs 33,500, ex-showroom.

Both Bajaj and Hero Honda believe they can significantly boost their motorcycle sales by launching bikes that cost around the Rs 20,000 mark. The primary market for these ultra low cost bikes would be rural India, where these bikes could replace bicycles and mopeds etc. While motorcycle buyers in bigger Indian cities gravitate towards style and performance, purchase price and fuel-efficiency are still the two most important factors for motorcycle buyers in smaller towns.

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