The Bajaj-Triumph alliance were forged because there's a massive potential for motorcycles in the 350-500cc space in India. This is a segment where Royal Enfield rules and Bajaj has been trying hard to take away some sales. It tried with the Dominar 400, but that plan failed miserably. With the new Triumph Speed 400 and the Scrambler 400X, Bajaj is optimistic about this modern retro approach and will price these bikes aggressively.
We believe Bajaj will price the Speed 400 between Rs 2.6 lakh and Rs 2.7 lakh (ex-showroom), whereas the Scrambler 400 X will be a bit more expensive at around Rs 2.8 lakh – Rs 3 lakh (ex-showroom). Obviously, these prices will be introductory and increase after a few months – something Bajaj does with all their premium bikes. Throughout their press release, Bajaj mentioned 'aggressive pricing' thrice, which makes us believe the brand wants to take away a lot of sales from RE.
The Royal Enfield Interceptor 650 is priced at RS 3.03 lakh – this is a multi-cylinder motorcycle. So the Pune-based manufacturer has to keep the prices below it, but the new Triumph bikes may not look value-for-money if it doesn't. Even though the Triumphs get a 40bhp modern engine and electronics like a traction control system, it is still a single-cylinder motorcycle. In India, people perceive a multi-cylinder motorcycle (even if it has simple cycle parts) as more aspirational and premium than a single-cylinder bike with many features and equipment. And we think Bajaj knows this and doesn't want it to jinx the initial response to the bikes.
Regarding product positioning, Triumph may have better brand value than the Royal Enfield in India or abroad, but these new 400s are being made here with the help of Indian suppliers. So the cost of manufacturing the bikes is lower. If Bajaj had been dominating the 350-500cc space, it could have asked for more money, but right now, it is trying to dethrone Royal Enfield, which is possible only if the motorcycles are value for money.
The upcoming Royal Enfield 450s are expected to be priced between Rs 2.5 lakh and Rs 3 lakh, and Bajaj knows about it. So the pricing we expect for the Speed 400 and the Scrambler 400X can become a big reality. And when it does, there could be a wave of RE riders switching to a more expensive-looking Triumph brand.
