Italian bike brand Benelli, owned by China's QianJiang (QJ) Group, wants to develop its Indian operations into a hub for design and manufacture of mid-capacity motorcycles to revitalise the domestic play.

Benelli, along with its Hyderabad-based partner Mahavir Group, will ready investments for a Research and Development (R&D) centre, a manufacturing facility, and a parts supplier park as part of its Phase II expansion programme.

A memorandum of understanding (MoU) has been signed by the company with the government of Telangana to that effect. The state will also play host to a completely knocked down (CKD) assembly plant having a capacity of 10,000 units a year, that will start operations in October this year.

Benelli was in a tie-up with Pune-headquartered DSK Motowheels, part of DSK Group, for marketing its bikes here with engines ranging from 250cc to 1200cc. The price of these bikes ranged from Rs 1.88 lakh to Rs 12 lakh.

The partnership ended abruptly a few months ago following the arrest of Shirish Kulkarni, Managing Director of DSK Motowheels in a financial fraud also involving his father Deepak Kulkarni, the Founder of the DSK Group.

In 2017, Benelli's India sales went down to 1,700 units from 2,200 units in 2016. The company discontinued sales operations after April this year.

The setback, though, did not impact Benelli’s ambitions for India.

Speaking to Moneycontrol Dante Bustos, Chief Marketing Officer, Global- Benelli said, “There were a lot of things that we were not able to do during our earlier partnership. One of which was to have a greater brand communication with the Indian buyers, create an ecosystem for the brand. We will begin doing that now."

Vikas Jhabakh, MD, Benelli India said, “The Phase I of our plan, spread across 3 acres, is to get the products back into India through CKD because products should not be away from the market for so long. Then Phase II, with 20 acres, will involve charting out local production, R&D, sourcing of parts locally. Benelli is very confident and committed to the India growth story."

Mahavir Group has been in the automotive dealership business for two decades. It has dealerships of Mercedes-Benz, Skoda Auto, Benelli, and Isuzu. While about 18 existing dealers of Benelli will be now part of the new partnership, a further 20 dealerships will be added every year for the next two years as part of the expansion plans.

The Indian market is witnessing a surge in bike launches targeting buyers looking for the 300cc and above class. BMW, TVS, Bajaj, KTM, Triumph, Harley-Davidson, Husqvarna, Yamaha, Kawasaki, Honda and Eicher Motors-owned Royal Enfield have either launched products in this segment or are in advanced stages of product development.