Bajaj Auto, based in Pune, has a presence in over 90 countries and follows a distribution-led model where its distribution partners manage local operations, including assembly.
Sharma mentioned that the initial capacity of the proposed Brazil plant, expected to be located in the Manaus Special Economic Zone, will be 20,000 units per month. He added that production is set to commence within the next 12 months.
Apart from producing Bajaj models, the proposed Brazil facility will also manufacture motorcycles for Austrian company KTM AG, of which Bajaj Auto holds a 48% stake.
“Brazil is an exception due to its size, complexity, and sometimes unpredictability. It requires a longer-term staying power. So, keeping these factors in mind, we thought it was best to have a different business model and undertake the business development directly,” Sharma told ET. The company has yet to finalize the investment plan for the upcoming unit.
The distributor model has allowed Bajaj Auto to combine its expertise in product, manufacturing, and brand development with the entrepreneurial energy and knowledge of its local partners. This model has proven successful, enabling Bajaj Auto to achieve a leadership position, Sharma stated.
According to market research firm IMARC Group, Latin America’s two-wheeler market reached 10.6 million units in 2022. It is projected to reach 23.7 million units by 2028, exhibiting a growth rate (CAGR) of 14.2% during 2023-2028.