LA Bicycle seeking JV in India

Chief executive officer Surasith Tiyavacharapong said yesterday that the company was in talks with a local partner in India. It will enter the Indian market via a joint venture in which it will hold 51 per cent and the local partner the rest.
“India is a high-potential market for us because of its large population. Output at the factory there will focus on both the domestic and foreign markets,” he said.
The factory in India will have a capacity of about 30,000-50,000 units per year, targeting the mass-market segment. However, he declined to give more details about the size of the investment.
In addition, Surasith said the company was negotiating with a Taiwanese partner to penetrate the bicycle market in mainland China.
“We’re thinking of which way and in which form to do marketing in China,” he said, adding: “We have to make customers over there understand how LA is different from other brands in China.”
The LA brand has been a leader in the mass-market bicycle business in Thailand and neighbouring countries such as Laos, Cambodia and Vietnam. LA bicycles account for an average of 75 per cent of this market.
Under its three-year business plan, Surasith said the company aimed to be the market leader in Asia in 2015, buoyed by sales from all segments. Apart from the mainstream segment, LA has tried to expand such other segments as high-performance bikes, priced from Bt9,000 to more than Bt100,000 per unit, and the technological segment, featuring electrically powered bicycles.
He expects the LA E-Ride, which costs Bt25,000-Bt26,000 per unit, will push sales revenue to Bt4 billion this year. The E-Ride fits into both the bicycle and scooter segments. The company has registered its trademark and patent for the lithium-battery-powered E-Ride in a number of countries in Europe and Asia.
Surasith said the company would export the first set of 10,000 electric bicycles under an original equipment manufacturing (OEM) contract to Japan this year.
“We target sales of 10,000 electric bicycles totalling Bt500 million this year, aiming at the both domestic and foreign market at 50:50,” he said.
The company’s major export markets are Britain at 60-65 per cent, Germany at 20 per cent, and France, the Netherlands, Italy and Austria with the rest.
Excluding the electric-bike segment, LA Bicycle (Thailand) has total output of 200,000 units a year. Surasith said sales revenue from the non-electrical segment would grow by 20 per cent this year via 70 LA shops nationwide.