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Old 07-27-2011, 09:35 PM   #1 (permalink)
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Red face Why Bikes are priced higher than cars (for the same CCs)

Hi all,

Just sharing a few thoughts that are in my mind for long. Fellow Bikers, throw some light on these :

(1) If an Indian company can develop a full-sized car (NANO-623cc) for 1.5 lac, why is it not possible to produce a Motorcycle with atleast 500cc for less than 1 lac?? Why not?!

(2) 150cc segment bikes give an approx mileage of 40-50Km/litre. Karizma-223cc bike gives 25-35Km/litre. But how a car like Alto-797cc is able to give 18Km/litre approx and that too with much larger kerb weight?

Are these due to:
  • A bike engine is more costlier to produce because it should be of lesser weight
  • Bike's compact packaging wants more lightweight/costlier parts
  • or any other reasons
Please excuse me if these were discussed earlier here. I am a novice when it comes to bike internals, excuse me!
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Old 07-30-2011, 02:01 PM   #2 (permalink)
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General discussion approved
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Old 07-30-2011, 02:18 PM   #3 (permalink)
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reply in bold ...

Quote:
Originally Posted by vineshp View Post
Hi all,

Just sharing a few thoughts that are in my mind for long. Fellow Bikers, throw some light on these :

(1) If an Indian company can develop a full-sized car (NANO-623cc) for 1.5 lac, why is it not possible to produce a Motorcycle with atleast 500cc for less than 1 lac?? Why not?!

it is just a question of pricing strategy and profit margins, besides, large capacity bike sales numbers are less so, they have to compensate for production and R & D costs in lesser number of sold bikes, so price per bike shoots up.

(2) 150cc segment bikes give an approx mileage of 40-50Km/litre. Karizma-223cc bike gives 25-35Km/litre. But how a car like Alto-797cc is able to give 18Km/litre approx and that too with much larger kerb weight?
the main reson is that as volume (CC) increase, engine's efficiency increases and also a car's engine is not tuned in a similar way as that of bike or you can say that a car's (alto) engine is detuned, when compared to bike standards


Are these due to:
  • A bike engine is more costlier to produce because it should be of lesser weight no. although it should be of lesser weight, i don't think any indian bike manufacturer takes any measures to make a bike ultra light.
  • Bike's compact packaging wants more lightweight/costlier parts
  • or any other reasons
Please excuse me if these were discussed earlier here. I am a novice when it comes to bike internals, excuse me!
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Old 07-30-2011, 03:26 PM   #4 (permalink)
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I used to think on the same lines, before, then I saw and read bout the Mighty Busa, ever wondered why its for 14Lacs ? That too for a 1.3L mill ? Its was the fastest production bike of its time, from Suzuki, now compare it to another Suzuki, the Swift, runs on the 1.3L mill, but speed ? power ? and just so that you know, the Busa returns more kms to litre than the Swift
1.5Lacs for the Nano is a good thing, now at the same price you get the R15, more power,speed and fuel efficiency !
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Old 07-30-2011, 06:37 PM   #5 (permalink)
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Quote:
Originally Posted by vineshp View Post
(1) If an Indian company can develop a full-sized car (NANO-623cc) for 1.5 lac, why is it not possible to produce a Motorcycle with atleast 500cc for less than 1 lac?? Why not?!
Nano or BMW, first & foremost thing to understand is economy. Did you know that Germany has taxi's plied on BMW & Merc's? Another tip, the C250R STD sold in India costs not more than 1.5L Ex showroom anywhere in the country, while the STD cost about $3999 here at local showroom. The conversion works to 1.87L.

Coming to answer your point on a 500cc motorcycle for less than a Lakh, I'm not sure if there's any motorcycle that's sold anywhere in the world that costs less than a Lakh. Let's take it for the point of discussion, a product is always made for the demand & not the other way.

There's a huge opportunity for cars, people are obsessed with cars as we were all deprived of good products for over 50 years & its only in the last 15 years we're seeing competitive products & affordable ones in the last 3-4 years with the raising disposable incomes.

Having enough said on economy, a 623cc for a car is just like 49cc on a motorcycle, but not 500. If it were a realistic comparison, a 500 cc should be compared to atleast a 2-3L engines in car, for the present economy we have

Quote:
Originally Posted by vineshp View Post
(2) 150cc segment bikes give an approx mileage of 40-50Km/litre. Karizma-223cc bike gives 25-35Km/litre. But how a car like Alto-797cc is able to give 18Km/litre approx and that too with much larger kerb weight?
Again the comparison is incorrect; check out the power ratio on the two wheeler vs car, there's an answer hidden in it.

Again technology does matter; talking from a very base point of view ZMA & 150cc bikes are carb'd while Alto is Fi which has precision intake compared to carb'd engines. To me, its really a good surprise on the 18Kmpl of Alto.
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Old 07-30-2011, 06:55 PM   #6 (permalink)
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Quote:
Originally Posted by burninrubbr View Post
the Mighty Busa, ever wondered why its for 14Lacs ? That too for a 1.3L mill ? Its was the fastest production bike of its time, from Suzuki, now compare it to another Suzuki, the Swift, runs on the 1.3L mill, but speed ?
the Busa only costs 14 lac in India. (Mighty taxes)

it is priced at 6.7 lac in the US.

very similar to the Swift.

so does the "bikes are priced more than cars" theory still stand?
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Old 07-30-2011, 08:32 PM   #7 (permalink)
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+1. And Remember for those 6L odd rupees you would be in the premium end of the two-wheelermarket whereas in car market you would be in 'cattle class'

The price differential in India is primarily due to low (perceived or real I don't know) demand for higher cubic capacity bikes, leading to lack of investment in producing these, leading to imports having high duties

And why low demand? Because most of the junta (including yours truly) is obssessed with mileage. Y? Because petrol prices here are amongst highest in the world. So people do not want to buy 'two-wheeler' which returns only 16-20kmpl.

So root of the problem is high petrol prices in India. Tax petrol less, bring down its price, obssession with mileage reduces, curiousity, interest and demand in higher capacity bikes increases, local investment will follow and then one day we will also be able to buy a Busa for 6L or even less. Till then the only Busa most of us can afford is the one Bovine kind has a liking for
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Old 07-31-2011, 12:28 AM   #8 (permalink)
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Although some of the points are repeated, here is my view.

- Lesser demand. So tough to make profit by selling large quantities for less margin.
- Alto weighs 725 kg and power is 47 bhp. Power to weight is 0.06 bhp/kg
Karizma weighs 150 kg and power is 17 bhp. Power to weight is 0.11 bhp/kg
This means a bigger engine returns lesser power and a smaller engine returns more power. This means the bike is not tuned for mileage but the car is. Also the bike has better acceleration than the car.
- More RnD is needed for the bike as compared to a car of same cc. Increase in price.
- Mechanics need to be trained more for higher cc bikes. More cost again.
- I guess Nano was produced with the aim of selling very large numbers with less margin and making a profit. Though it was very ambitious, to keep the production costs less than 1.5L they had to use cheaper methods. Resulting in a car that can hardly be called a car. I don't think this possible with a 500 cc vehicle in India. For that it should be a first gen splendor or Bajaj Byk (if anyone remembers) with a 500 cc engine and hope for selling large numbers.
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Old 07-31-2011, 01:06 AM   #9 (permalink)
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Thanks xBhpians for your views! I am learning..

Quote:
Originally Posted by princesirohi View Post
it is just a question of pricing strategy and profit margins, besides, large capacity bike sales numbers are less so, they have to compensate for production and R & D costs in lesser number of sold bikes, so price per bike shoots up.
Quote:
Originally Posted by aargee View Post
a product is always made for the demand & not the other way.
From your replies, I understand that even though the cost to make a higher capacity bike is less, Manufacturers are charging way higher because of very low demand.

If so, in developed countries, the demand for higher capacity bikes is there. Even there, (As aargee pointed out the price of CBR250R) the prices are high, why?

Quote:
Originally Posted by xionite View Post
the Busa only costs 14 lac in India. (Mighty taxes)

it is priced at 6.7 lac in the US.

very similar to the Swift.

so does the "bikes are priced more than cars" theory still stand?
exactly! There is a increase of almost 7 lakhs for the import taxes. Then, an Indian company can sure make a similar product and for sure it'll cost less than the 7lac duty.. isn't this a big opportunity for indian makers?

Quote:
Originally Posted by NitinGirish View Post
And why low demand? Because most of the junta (including yours truly) is obssessed with mileage. Y? Because petrol prices here are amongst highest in the world. So people do not want to buy 'two-wheeler' which returns only 16-20kmpl.

So root of the problem is high petrol prices in India.
very true! this is a major hindrant..
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Old 07-31-2011, 03:23 AM   #10 (permalink)
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Quote:
Originally Posted by vineshp View Post
If so, in developed countries, the demand for higher capacity bikes is there. Even there, (As aargee pointed out the price of CBR250R) the prices are high, why?
Again, you need to compare Apples to Apples;
If we were to compare Nano vs a 500cc (including the RE C5), then they're incorrect. Reason being that, Nano is a VFM, entry level, whatever you call, in cars. However RE C5 is a life style motorcycle. Probably a good comparison would be Merc, BMW which is more of a life style.

BTW, the motorcycle market in developed countries are more of saturated; very less in demand compared to India. The price of C250R is a little over 30K than India probably because of exporting cost.

Quote:
Originally Posted by NitinGirish View Post
The price differential in India is primarily...Bovine kind has a liking for
That is the one I explained in one word - ECONOMY

Check out another interesting observation...
SX4, though is a sports model in US, the price conversion works to about Rs 7.7L which is 150Bhp & needless to talk on quality; while SX4 is being promoted as premium in India for a price of 7.3L as base version producing 104 PS (roughly about 99 Bhp) & needless to compare with the US standard. Anyway, let me stop with cars for now.

Put it this way...
If I were to manufacture a motorcycle that is capable of carrying 3 people or a max of 210 Kg kerb with a price tag of 50K, top speed of 60 Kmph & 60 Kmpl FE & sell it at only 4 metro's in India, would I be able to sell?

If I were to manufacture a motorcycle with low sprung seat with an inline twin 250cc, FI, ABS, 30 Kmpl & top speed of 160 Kmph & sell it at Tier 3 cities, would I be able to sell?

Point - Product technology & quality improves only on a consumer driven market.. India is yet to become a consumer driven market.

PS - I really don't wish for twin or single 500cc to be available for an affordable price until the chaotic traffic conditions are taken care. Until then, the huge import tax are completely justified
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Last edited by aargee; 07-31-2011 at 03:40 AM.
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