Runner Automobiles has beefed up its marketing efforts in Nepal in a bid to capture 15 percent of the growing motorcycle market in the Himalayan nation in the next five years.
To this end, Runner Automobiles Ltd recently appointed a distributor, Raman Motors, which is a subsidiary of Nepalese conglomerate Raman General.
Raman has already appointed 11 dealers across the country to sell Runner motorcycles and plans to employ more and introduce after-sales services.
Runner Automobiles started to export two-wheelers to Nepal in January this year, becoming the first motorcycle exporter from Bangladesh.
“Since January, we have shipped 400 motorcycles of seven models,” said Hafizur Rahman Khan, chairman of Runner Automobiles, at a programme to introduce the distributor at Hyatt Regency Hotel in Kathmandu on Saturday.
Since Nepal is a landlocked country, Runner sends shipments through a land route across Kakarbhita, which is only 50 kilometres from Indian and Bangladeshi border points of Fulbari-Banglabandha.
Bangladeshi motorcycles face more than 100 percent duty in the Nepalese market, said Khan. “Still both the market and our business are growing at a fast rate.”
Primarily, Runner has a target to send 3,000 units of motorcycles to Nepal every year.
Khan said Nepal’s economy is growing fast and its landscape is also favourable for riding motorcycles in comparison to driving other vehicles. “We have started exporting motorcycles to Nepal as there is a big potential in the market thanks to the country’s young population.”
The company’s target customers are aged 21 to 35. Runner Automobiles plans to ship motorcycles to other markets in Asia such as Thailand and Cambodia soon. It is also considering African countries like Nigeria and Zimbabwe.
“These are all potential markets for us,” Khan said. According to Khan, Bangladesh can do well in the Nepalese market due to lower production costs compared to that in China and India, the two major players in the motorcycle segment in the country.
Some 200,000 motorcycles are sold in Nepal each year.
Khan also talked about the Bangladesh market where 350,000 units of two-wheelers are sold annually.
The market size in Bangladesh is Tk 3,500 crore with a price average of Tk 100,000 per unit. Runner Automobiles has the capacity to manufacture 1,000 units every day in its Bhaluka plant but produces nearly 500 pieces to cater to both domestic and overseas markets.
The company produces more than 40,000 units of motorbikes a year and controls more than 11 percent of the domestic market.
The plant makes motorbikes with capacities ranging from 80cc to 150cc. Its sales have been growing at 20 percent year-on-year.
“Our target is to export more than the sales in the local market as some markets are opening up,” said Khan, adding that two more local companies are entering into motorcycle manufacturing for the local market.
Runner started its production of motorbikes in 2011 in Bhaluka and currently employs 888 people. It has more than 200 dealers across the country.
Khan urged the government to prepare a guideline for the promising sector and help develop the backward linkage industry.
Some backward linkage companies have already been set up in Bangladesh and they are making seats, chains, indicator lights and plastic products for motorbikes.
Khan sought at least 20 percent cash incentive from the government for the nascent industry.