BMW and TVS Motor to jointly develop sub-500cc motorcycles

German automobile group BMW and India’s two- and three-wheeler-maker TVS Motor Company will jointly develop sub-500cc motorcycles to be sold under the respective company badges, said company officials.

“We will enter into below 500cc motorcycles Asian market. BMW and TVS Motor have signed a long term cooperation agreement,” Stephan Schaller, president, BMW Motorrad, told reporters here.

Venu Srinivasan, chairman of TVS Motor, said the first bike will be rolled out in 2015 and there is no equity participation by either of the two companies, or there will be a royalty payment.

He said TVS Motor would invest around Euro 20 million to develop and roll out the vehicles under this cooperation agreement.

Schaller and Srinivasan parried questions on the kind of sub-500cc models they would develop but said the models would be sold globally under their respective brands.

While Srinivasan said the company would make the proposed vehicles at its plants located in Hosur or Mysore, BMW’s Schaller said the company would produce the bikes at its Berlin factory.

Schaller said BMW group is realigning its premium two-wheeler business and part of that is the launch of an electric scooter next year.

Srinivasan said the German group looks at TVS Motor for its ability to develop small motorcycles, supply chain and mass production.

The agreement involves the two companies each offering their own vehicle derivatives, which will be sold through their own distribution channels in India and across the globe.