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Bajaj Auto launches CNG bike starting from Rs 1 lakh

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Published Date: 08 Jul 2024Updated Date: 31 Dec 20246 mins readBy MOFSL

In a bold move set to reshape India's commuter bike landscape, Bajaj Auto has unveiled the world's first CNG-powered motorcycle, the Freedom 125. Priced competitively at INR 95,000, the Freedom 125 is currently available for booking in Maharashtra and Gujarat, with a nationwide rollout planned for the next quarter. This innovative offering marks a significant milestone for Bajaj Auto, renowned for pioneering clean-energy solutions in the Indian market, particularly with their dominant 87% share in CNG auto rickshaws.

Features of Freedom 125

The Freedom 125 boasts three variants: NG04 Disc LED, NG04 Drum LED, and NG04 Drum, catering to diverse consumer preferences. A standout feature is its auxiliary petrol tank, ensuring uninterrupted operation even when the primary CNG tank is empty, effectively eliminating range anxiety. Seamless switching between CNG and petrol further enhances user convenience, a crucial factor in gaining consumer acceptance.

Economic and Environmental Advantages

This initiative by Bajaj Auto aligns perfectly with current consumer needs and macroeconomic trends. With a significant proportion of Indian households earning modest incomes, the demand for cost-effective transportation options is pronounced. The Freedom 125 promises substantial fuel savings, offering up to 50% lower operating costs compared to traditional 125cc motorcycles, and approximately 43% savings over 100cc models.

Market Dynamics and Potential

In a market dominated by Hero (56% market share) and Honda (19%), Bajaj Auto aims to disrupt the status quo by appealing to budget-conscious consumers seeking both performance and economy. Positioned competitively around INR 1 lakh ex-showroom, the Freedom 125 bridges the gap between 100cc and 125cc bikes, promising comparable performance with enhanced cost efficiency.

Strategic Implications

The launch of the Freedom 125 is not merely a product introduction but a strategic move to revive the commuter bike segment. With sales volumes in this category yet to recover to pre-pandemic levels due to rising ownership costs, Bajaj Auto's foray into CNG motorcycles could rejuvenate market interest and potentially increase their current 16% market share.

Government Support and Infrastructure

Government initiatives supporting CNG infrastructure growth have been instrumental in expanding the network of CNG stations from 3,000 in 2020 to over 6,000 by December 2023, with ambitious plans to reach 17,700 stations across 300+ cities by 2030. This infrastructure expansion complements Bajaj Auto's market strategy, ensuring adequate support for consumer adoption of CNG vehicles.

Challenges and Opportunities

Addressing consumer concerns around mileage, maintenance, and refueling convenience will be pivotal in driving widespread adoption of CNG motorcycles. Bajaj Auto's assurance of a combined range of 330km on petrol and CNG and an estimated CNG range of 204km underscores their commitment to reliability and practicality.​​​​​​​

Future Outlook

Looking ahead, the success of the Freedom 125 hinges on consumer education, regulatory support, and evolving economic conditions. As India explores integrating natural gas under GST, potential tax reforms could further enhance the attractiveness of CNG vehicles, aligning with global trends towards sustainable transportation solutions.

 

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