Bajaj to launch four-wheel vehicle but it's not a car

It's got four wheels and seatbelts, but Bajaj Aut
the creator of India's first quadricycle, would
rather you didn't call it a car.

Bajaj Auto is marketing the RE60 as a more
stable and comfortable alternative to the three-
wheeled autorickshaws ubiquitous on India's
roads even though it looks like a small
hatchback car and is expected to cost less.

Weight, top speed and other specifications,
including safety standards, mean the RE60 will
not be classified as a car. But that didn't stop
executives from top automakers such as Tata
Motors from comparing it to a car and finding it
safety features come up short.

Rajiv Bajaj, the company's managing director,
insists the RE60 is neither a car nor an
autorickshaw. The government is even creating
new classification category for the vehicle, whic
is expected to be launched within months.

"In every market that a three-wheeler is availabl
the quadricycle should be relevant," Mr Bajaj tol
Reuters in a phone interview.

"Because at the end of the day it provides a ver
logical upgrade from a three-wheeler for people
who want to pay a little more and want to have
the comfort and safety of four wheels, four
doors, a roof and seatbelts," he said.

In India, autorickshaws typically have no doors
and a soft roof. The vehicles are usually turned
into taxis and known in many countries as tuk-
tuks.

The RE60 is part of a long-term expansion
strategy by Bajaj to boost sales growth at home
and abroad.

The company is the world's largest autoricksha
maker and India's second largest motorcycle
maker, and sales of both these vehicles have
decelerated over the last two years, hit by fallin
demand in a slowing economy.

Bajaj's three-wheeler sales fell 6 per cent in the
2012/13 financial year compared to a 17 per
cent increase in the previous year and a 28 per
cent rise in 2010/11.

Motorcycle sales also showed a similar trend:
they fell 2 per cent in 2012/13 compared to a
13.2 per cent gain in 2011/12 and a 35 per ce
increase a year earlier.

Exports of motorbikes and autorickshaws
account for more than a third of Bajaj's sales.
The company counts Mahindra and Mahindra Lt
TVS Motor Company Ltd and Italy's Piaggio as
competitors in the three-wheeler segment.

Safer, but not cheaper

The RE60 weighs 400 kilograms (880 pounds),
about 100 kg more than Bajaj's smallest
autorickshaw and half as much as a small
hatchback. The engine, which can run on
gasoline or compressed natural gas, goes up to
70 kilometres per hour (about 40 miles per
hour).

The vehicle is likely to be priced between an
autorickshaw and a small car. Analysts expect
the RE60 to cost Rs 200,000, more than the
roughly Rs 150,000 for the most basic Bajaj
three-wheeler but less than the Rs 270,000 for
India's bestselling car, the Maruti Alto
hatchback.

Bajaj spent Rs 550 crore developing the vehicle,
according to media reports. The company can
initially make up to 5,000 vehicles a month and
has been waiting for two years to get them on
India's roads.

The federal government is expected to allow
quadricycles from October 1.

Bajaj hopes the quadricycles will catch on in
countries where three-wheelers are widespread,
and has sent samples for test runs in Sri Lanka,
Colombia and Kenya. Managing director Bajaj,
however, declined to give any sales forecasts.

Analysts said quadricycles are likely to have
broader appeal than the autorickshaws.

"Specifically, in cities in the next three to four
years it could replace the three-wheeler,
primarily because it provides better safety, as
well as comfort as well as better fuel efficiency
when compared to three-wheelers," said Nitesh
Sharma, an analyst with brokerage Espirito Sant
Securities.