The JV between UM Motorcycles and Lohia Auto Industries seems to have run into a rough patch with no new funding from the US counterpart, essential for continued operations in India.
10 Oct 2019 | 19408 Views | By Ujal Nair
Following reports of several UM Motorcycles showrooms shutting down in India, it is learnt that American bikemaker UM Motorcycles has stopped its operations in India and that the joint venture with Lohia Auto looks to be strained. With this, it joins the list of automakers to exit India which includes ...
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Following reports of several UM Motorcycles showrooms shutting down in India, it is learnt that American bikemaker UM Motorcycles has stopped its operations in India and that the joint venture with Lohia Auto looks to be strained. With this, it joins the list of automakers to exit India which includes GM and MAN Trucks.
The last UM Motorcycles’ product launch was the Renegade Commando Classic, priced at Rs 189,000, in September 2017. The long-drawn slowdown in the two-wheeler industry seems to have hit the company hard and production at the Kashipur plant in Uttarakhand seems to have stopped.
Understandably, dealers of UM Motorcycles are getting furtive, given that there are no new product launches expected any time soon. Also, it appears that UM Motorcycles is facing a financial crisis globally and reports have it that the company has shut its operations in China.
In an interaction with Autocar Professional, Ayush Lohia, CEO, Lohia Auto Industries, explained, “Our JV with UM Motorcycles was of a 50:50 nature. UM Motorcycles is currently not able to invest any money in India and thus the Kashipur plant in Uttarakhand is not manufacturing any of the UM motorcycles.”
The UM motorcycles were built with 40 percent localised parts and 60 percent imported. While most of the local suppliers are based in North India, the imported parts were being sourced from Indonesia, Thailand and a few other countries. Ayush Lohia confirmed that all the supplies for the last-produced UM motorcycles have been paid for and no new parts are to arrive at the plant. However, Lohia says not all is lost in the JV and he does not plan to dissolve it any time soon.
Not too long ago, till April 2019, UM Motorcycles was retailing around 200 motorcycles a month in India. At present, most of its dealers have pulled down shutters while a few are open just for the servicing process. Acknowledging the Indian dealers’ plight, Lohia said, “We are awaiting clarity from our partner as regards addressing our dealers’ condition. For the time being though, since UM is showing no intention of going ahead with its India operations, I am not able to give a confirmed status on the current scenario of the brand in India.”
It may be noted that after April 2019, reports started coming in that UM Motorcycles are discontinuing its operations temporarily in India as none of its products had ABS. Around the same time, official reports from the company had stated that new launches could be expected during the festive season.
UM’s product portfolio in India includes the Renegade Commando, Renegade Sport S, Renegade Mojave and Renegade Classic. They are all American-styled cruiser motorcycles powered by the same 300cc liquid-cooled engines. It was speculated that UM Motorcycles was supposed to come out with a 150cc scooter this year, called the ‘Chill 150 ABS’. In the current scenario, that project seems to be in the chiller.