Is the Kawasaki Z800 headed for local assembly in India?
There have been several rumours floating around about Kawasaki beginning local assembly of their Z800. So far, though, they have proven to be just that rumours. However, there is a strong case for local assembly.
The Kawasaki Z800 is one of the most affordable CBU motorcycles in the country today. It is, naturally, one of the highest selling Kawasakis. If Kawasaki were to decide to assemble the motorcycle locally, the motive will be an even lower price. Granted, at Rs 8.7 lakh (on-road Mumbai), the Z800 is already at an accessible price point. And usually a CBU to CKD conversion comes with a price drop of around 30 per cent.
But will that kind of price drop be possible with the Z800? We think not. The Z800 is already priced rather well. In fact, it is already at par with locally assembled motorcycles like the Triumph Street Triple. In order to not eat into their margins, a smaller reduction in price, between 15 to 20 per cent is more likely. At this point, it is already competing directly with the Rs 7.4 lakh (also on-road Mumbai) Versys 650. At 30 per cent, it will pretty much not only destroy the Versys 650 and start competing with the bread and butter Ninja 650 and the ER-6n.
The price equation is not the only hurdle to local assembly. Bajaj and Kawasaki have an arrangement that locally assembled Kawasakis are sold by the KTM dealer network, while CBU motorcycles are sold by the handful of Kawasaki dealers. Selling CKD Z800s through KTM will increase the motorcycle's reach quite a bit, it also means that the Kawasaki dealers will lose one of their hottest selling motorcycles, and consequently, a fair chunk of their revenue. Not something they would be happy about. This makes a policy change in this regard a long and difficult process.
If the Z800 were about to undergo a model change, shifting its sales locations could be easier but the Z just received a facelift for 2016. Sharing between networks isn't possible either, the KTM and Kawasaki dealer spread overlaps quite a bit.
While further lowering the price of the Z800 is sure to give Kawasaki sales in India a fillip, as you can see, it is a difficult situation with many moving parts. Kawasaki is in a unique position in this regard because none of the other manufacturers in India share or piggyback distribution with others.
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