UM Lohia JV in disarray – Multiple dealers shut down
UM Motorcycles is an American brand, which entered India via JV with India based Lohia Auto.
It’s been a few short years that UM Motorcycles has been retailing its bikes/cruisers in India. The partnership with Lohia Auto came into being earlier in 2014. Their Renegade range of motorcycles are owned by thousands in the country.
UM Motorcycles hasn’t quite been operational in India for a while now. They officially cannot sell bikes in India as none of their bikes come with ABS, a feature which is a must since 1st April 2019. They also have no plans of upgrading to BS6 standard, which comes into effect from 1st April 2020.
This shouldn’t come as a surprise as the lack of activity has been coming to people’s notice for a while now. As the situation had been ballooning into nothingness, there was an expectation that efforts would result in some positive change. But that’s not to be, and both JV entities, Lohia Auto and UM Motorcycles are waiting and watching.
The brand even had a grand showing at 2018 Auto Expo – even showing an electric bike (Renegade Thor) with a launch price of Rs 4.9 lakhs. The other two new bikes at Auto Expo were UM Renegade Duty S and UM Renegade Duty ACE. These showcasing gave dealers hope about future. Each dealer has invested about Rs 1 crore in the brand.
While brand awareness, and visibility were minimal at the time of peak operations, the brand had still managed to get a dedicated group of riders who were keen enough to ride to India Bike Week in 2017. Despite club activity, brand presence remained limited.
As with all grand plans, when production was initiated, it was at the Kashipur plant with production capability of a lakh vehicles in a year. However, UM Motorcycles hasn’t been in the business long enough to use the plant’s production capacity strategically. Sales in the last fiscal was below 3k units.
Following regular launches, the brand had gotten around to selling Renegade Commando Classic, Renegade Commando Mojave, Renegade Commando and Renegade Sports S. The bikes were available in a price range of Rs 1.59 – 1.95 lakh, ex-sh. The JV was doing business from over 75 dealerships.
However, that healthy marketplace is a far cry from today’s reality. With no clarity on how the business is likely to proceed, if at all, existing dealers have been the ones left in a lurch as JV authorities tread on unknown waters. Many dealers have booked losses and shut shop officially.
The current atmosphere of uncertainty has prompted dealers to shut shop. Those in business, are captilising on service for products sold. With no clarity on productions, sales channels have run dry.
In the initial months, the situation seemed one that would be easy to tide over because the market was dwelled o the expectation of ABS compatible products. Following this, the marketplace was getting ready for BSVI compatible products. However, UM Motorcycles and Lohia Auto’s JV is in deep waters that have very little to do with market upgrades.
One UM dealer told ET Auto – “There are no employees left in the company. One of the company officials has informed us that nothing has been happening on the production side either.” Lohia Auto said, “It’s a joint venture, we can’t make the decision alone if a foreign partner is not interested. There are a lot of terms and conditions in the agreement.”