BusinessDay
Nigeria's leading finance and market intelligence news report.

‘Stallion Group, Bajaj align for tricycle market dominance’

Soon a new chapter will be opened in the tricycle business of in the country following the latest acquisition of the Indian Bajaj dealership by Stallion group. While MANISH ROHTAGI, managing director, Stallion Auto Keke Limited in this interview with MIKE OCHONMA, is optimistic that, the Indian 3-wheeler will soon take over the market segment, he is also calling on policy makers to focus more on greener transportation system in Nigeria.

What gave rise to the acquisition of the Bajaj franchise by Stallion group

For over 50 years, Stallion has successfully navigated the Nigerian terrain and has become a time-tested conglomerate that has its presence across the Nigerian economy. Stallion Group’s vision is to adopt global best practices and localize it to develop scalable, impactful and sustainable business that is committed to improving the socio-economic conditions of the communities. Stallion brand is now a household name in Nigeria touching lives everyday with its products like rice, fish, steel or auto sales, distribution and assembling.

It employs 4000 people directly and indirectly; it is one of the foremost conglomerates that hugely invested in the country gaining respect and trust of the community. Bajaj Auto on the other hand is a world leader in the intra city vehicle space. Loved in 70 countries, the brand stands for integrity, dedication, resourcefulness and determination to succeed and empower. With similar brand ethos, we believe that this alliance will go a long way in empowering Nigerians to be self-reliant and improve the interests of the stakeholders be it employees, dealers, distributors, vendors, mechanics, unions, logistic operators or bankers.

 

You have managed other Tricycle (Keke) brands, what is your attraction in switching over to the Bajaj franchise

With years of experience in multiple countries including Nigeria, I foresee the opportunity that Bajaj has vast potentials for growth in the Nigerian market. Bajaj is the dominant tricycle brand with over 70% market share in populous countries like India, Argentina, Columbia and many other Asian and Latin American countries. So the Nigerian success story is a matter of time. The right approach and service to the dealers and consumers to bring out the USPs of the product and essence of the brand will add strength for it to become the market leader.

Other competing brands like the TVS controls larger market share, how are you positioning the Bajaj especially in the South-south and South-east regions.

Bajaj is the world leader and market leader in the north, central Nigeria and many states in the east with dominant market share of over 85 percent. Our focus has always been in keeping our employees and dealers satisfied.

The core of our strategy in non-leading markets would revolve around our channel partners. The Nigerian customer is much evolved and well informed, and they have a keen eye for value for money and support by the company. We are committed to bring this to them.

 

With the downtown in global economies, are you considering any form of financing package to prospective customers.

The downturn in global economy has had a lasting impact on many industries.  Our customers are the ones who are most impacted by the pandemic as a lot of them are daily wage earners. Owning a tricycle in these times could be impossible if not supported through micro finance banks (MFBs) and non-banking finance companies that come forward to support them through hire purchase.  In terms of financing packages, we have many MFB’s and financing partners who are committed to support their purchases on best viable terms.

 

How well equipped will Stallion dealership be in areas of after-sales and spare parts back-up.

Aftersales and spare availability has been the backbone of Stallion Group flagship brands like Honda, Hyundai, Nissan, Changan, Ashok Leyland, KYC, Skoda, Volkswagen, Audi and Porsche. Service is one of the core strengths and the investment in state-of-the-art sales and service facilities to support the topical requirement justifies the commitment towards the customers.

We have well established processes which are laid down by Bajaj auto based on experience on product and customer requirements. We will have a dedicated network of service and spares which will be handled by highly trained Nigerian engineers and technicians. Highest level of craftsmanship is what one can see in our dedicated team of engineers and technicians.

 

Can you estimate the value of the 3-wheeler business in Nigeria.

Due the lack of formal accredited market information entity, it is difficult to estimate the actual market size. But based on the data for importation, it should be around 150,000 per year. There are about 400,000 tricycles (Keke) on Nigerian roads and there is potential of 2 million tricycles in the country.

The 3 wheeler market in in the country has high potential for growth as it serves two fundamental needs, one that of intra-city commute and the lack of available options for public transport and employment generation.

The mode of commute is fuel efficient and least polluting in comparison to any Tokunbo public carriers. With federal government’s support, Bajaj can also provide LPG and CNG options in the future. Stallion can bring it into the country. We are confident that, with the help of policy makers, we can make public transportation more affordable and cleaner.

Even if we estimate around 10 Keke per 1000 Nigerians, there is a potential to have 200,000 tricycles on the roads that can provide affordable transportation to this country. The policy makers should focus on greener transportation system.

 

Ruggedness of Bajaj tricycles on Nigerian roads compared to other brands

Bajaj Keke is known for its durability, speed and manuverability. We have actively sought customer feedback to drive innovation, product and service improvement. With Stallion, we run a very de-centralised operation with quicker decision making which will help drive our operating efficiency.

The RE- Keke model and the load carrier category called Maxima Cargo is expected to grow at a much faster rate as Stallion will actively push for the adoption of Cargo tricycles by existing partner and customer ecosystem.

Bajaj is the pioneer brand of tricycles in Nigeria loved by millions across the countries and the partnership with Stallion further adds to the strength.

In the last two years, I have travelled round the country to engage with customers and seek their feedback. I have observed that Bajaj is a dominant player in markets in north like Kano, Kaduna, Abuja, Sokoto, Kebbi, and in all these places and the hinterlands, the road severity is very high in comparison to the South Eastern parts of the country.

So, if is stands the test of those markets which are affected by severe harmattan, heat and poor infrastructure than the product is definitely our USP. It’s the most durable and rugged product with great performance.

In fact, there have been attempts to convert those customers to other brands, but they remain steady with the Bajaj brand because of the faith and returns on investment by customers.

The right communication and dealer engagement will be my primary objective in markets like Lagos and East and it will be a game changer.

 

To what level would you like to take Bajaj brand under Stallion franchisee in the next 5 years.

Our immediate task is to establish and forge long term partnership with our dealers and channel ecosystem across the country. Through these fulfilment partners, we envisage providing employment opportunity to five million Nigerians directly and indirectly over the next five years. Bajaj has always been a trusted and admired brand in the country, so is the case with Stallion, the synergy is going to take market by storm.

 

How competitively priced will the new entrant be compared to other brands.

Our pricing policy will be in line with the philosophy of increasing customer’s prosperity. For us, return on investment (ROI) and profit is important, and we will ensure that our pricing decision is aligned to it.

Price is an outcome of happiness of employees, dealers and customers and we will ensure that the thought resonates with all our stakeholders ubiquitously.

What are customers’ expectations from the redesign and remodeling imputs and marketing push to in the face of coronavirus pandemic 

Some of those affected by the coronavirus scourge are our customers; the economic slow-down has resulted in sparse incomes for their household exposing them and the passengers to the vagaries of managing while potentially exposing them to the virus.

Over the last two to three months, we have reached out to our dealers and they in turn to the riders. We have started distributing palliatives through the charitable arm of Stallion Empowerment Initiative.

Since the businesses are getting back following the lock-down, we are taking proactive and preventive measures to make sure, contact between the Keke operator and the passengers behind are minimized to control the spread of the disease.  A flexible separator is designed to keep the passengers and driver away and we are going to distribute it at no cost to our dealers. Apart from this, we are also preparing a specilaised kit that will include mask and sanitizers for both the drivers and commuters.

When consumers are in distress and the economy is bad, we will not increase our prices because of Naira devaluation against Dollar. We will have one fixed selling price throughout the pandemic period and remain on it especially during this pandemic period.

Going forward during our service campaigns, we will be conducting a health check, this will be mandatory in our service approach.

Why these innovativeness in your business model

We need to have a very strong people approach as the business is by them and for them. We have to first take care of people and their livelihood. Based on this philosophy, we are working with our stakeholders to take care of consumers and drivers.

Whatsapp mobile

Get real time updates directly on you device, subscribe now.