Ducati's Global Operations
"The 400 million euro worth company Ducati Motors, has 1172 employees performs highest business in the USA and UK. In the third world countries like India, it performs miscellaneous activities for production like importing of cables. Ducati's presence is mainly seen in the developed economies where bike racing is considered to be a passion. The developing countries like China and India are coming up on the same lines. Ducati has planned to ramp its dealerships in countries like India; where its sales target was increased last year to 150 units.
It has established six dealerships in the country and is in the plans to come up with more. The performance last year was not on par with global standards and expectations as the company did not make it to the sales target in the US. It performed considerably in the Asia Pacific region. In China the company opened its first store in 2009. It is not considered to be that popular a bike in the country where the Japanese bikes are more preferred due to its low price compared to the premium Ducati bikes.
Ducati Motor Holding S.p.A. the Italian sports motorcycle manufacturing company was founded in 1926 by three brothers namely Bruno, Adriano and Marcello Ducati. It started selling bikes from 1950 onwards. Ducati globally has seven families of bikes in 14 variants. Ducati is considered to be the most famous name in the motor sport racing across the world. Its association with racing championships is known for long. It has been doing well in the west but there is a major concern with the business in the east because the mindset of the people in developing nations is slightly different when compared to the west.
Due to its high price value, people in the east tend to buy a luxurious car instead of a bike at the same rate. Hence, Ducati has to form strategies to eliminate this mindset of customers by attracting them to spend the same amount on bikes than on cars. Economies of scale are another concern for the company in the eastern region.
The trend of bike racing is only coming up in the developing countries and is in the introductory stage. Ducati has a long way to go in order to perform well in these areas. For example, a normal Japanese bike can be bought for 50000-80000 rupees in India, whereas price of Ducati bikes is 10-45 lakh rupees. This drastic difference in price has to be checked and appropriate steps needs to be taken by the company.
Though sales target is also less in these countries, the company has to spread its wings to create awareness for sports bikes, in turn it will lead to popularity of Ducati in these regions. Will Ducati be able to spread the awareness for sports bikes in developing countries? Will it be able to bring a trend or revolution in the demand for racing and racing bikes in these countries? We still have no answers on it yet.