Yamaha motorcycle joint venture formed in the Republic of Peru

On November 21, Yamaha Motor Co., Ltd. (YMC) signed an official contract for the establishment of a new joint venture company in the Republic of Peru that will engage primarily in the sales of Yamaha motorcycles. YMC's partners in the new joint venture are the present Yamaha business partner Romero Group and YMC's motorcycle manufacturing and sales joint venture in Colombia, Incolmotos S.A.

The new company is to be named Yamaha Motor Del Peru S.A. (YMDP) and plans call for it to be established in Lima in December, 1997, and for operations in the sales of Yamaha motorcycles and Power Products and their after-sale service and parts sales in Peru to begin in January 1998.
The new company will be capitalized at US$2 million (approx. 240 million yen) with YMC investing 51%, Romero Group 40% and Incolmotos 9%.

Presently the Republic of Peru is the 5th largest two-wheeler market in Latin America, and with a high rate of economic growth and continued political stability predicted for the future, YMC believes it is an important market for motorcycles. The establishment of this new sales company under YMC leadership will enable the adoption of our Yamaha sales policies in Peru while the partnership with the Romero Group with its broad ranging corporate resources, including the largest banking and insurance companies in Peru, will enable a major expansion in sales operations for Yamaha motorcycles in Peru.

The new company will work to improve sales capability by reconstructing the existing sales network consisting of directly managed retail outlets and dealers. Also, the company's plans call for the import of Yamaha brand motorcycles not only from Japan but from our production bases in other countries like Brazil, India and China. In addition, support from Incolmotos in the same Andes market in the form of locally manufactured products and marketing experience will help the new company achieve speedy and timely supply of motorcycles that are best fitted to the Peruvian market. Through these efforts, the new company plans to sell 2,300 units in its first year (1998) and 5,500 units by the year 2002.

Peru is a motorcycle market with an annual demand of 10,000 units, which are used mainly for daily transportation such as commuting to work and school. A lso, Peru is one of the five countries in Latin America, along with Brazil,Argentina, Colombia and Mexico, that make up over 90% of the region's market with an annual demand of over 600,000 units.
Believing firmly in the growth potential of the Latin American market, YMC has already established joint ventures in Brazil (1970), Colombia (1986), Mexico (1991) and Argentina (1996), making the new company in Peru the fifth in the region.