Interview with Norton CEO Robert Hentschel

After acquiring Norton, TVS invested a further £100 million (US$126 million) in establishing and equipping a new state-of-the-art Norton factory at Solihull, on the southern outskirts of Birmingham, Norton’s traditional home city where it was founded 126 years ago in 1898. TVS then re-engineered the existing Garner-era Commando 961 to make it production-friendly, while now meeting Euro 4 compliance. Even though they were under no legal obligation to do so, TVS management led by joint Managing Director Sudarshan Venu then committed to manufacturing a series of Commando 961 Classic variants for delivery at no additional cost to the 29 customers who had paid Garner’s by then defunct company for their bikes, before launching the updated product to the general public, as the first new series production Norton model under TVS ownership.

In May 2021 TVS appointed Dr. Robert Hentschel as CEO of Norton Motorcycles, entrusted with bringing the historic British sporting brand back to the marketplace with a range of all-new models. "TVS has created a plan for Norton’s future transformation,” said Sudarshan Venu. “The brand will retain its core values which will be interpreted in a modern way for the customers of today, and tomorrow. As part of this we are excited to welcome on board a new management team led by Robert to lead this next phase of the journey."

The German executive was already the owner of a Norton Commando 961, which can’t have hurt his prospects in being hired to run the completely restructured company which built it! He joined Norton from Valmet Automotive, a Finnish supplier of battery systems, where he’d served as Managing Director since 2017. Before that, he headed up Ricardo Deutschland, and was previously a Director of British sports car manufacturer Lotus Engineering in 2010-11. I’d already interviewed him once before at the outset of his time with Norton, so the exclusive opportunity to speak with him again about the company’s future prospects provided a chance to review the story so far since TVS rescued the legendary British brand from the scrapheap of history. It came just weeks before the recent announcement that American engineer Brian Gillen would be joining Norton as chief technology officer, leaving a similar role at MV Agusta where he’d spent the past 17 years.

AC: Robert, we’re coming up to the fourth anniversary of the TVS acquisition of Norton in April 2021, but so far there’s no sign of any new models developed in your magnificent new factory. So where is Norton today? It seems from outside as if the development of the company under TVS ownership is lagging slightly.

RH: I don’t see any such lag, because we have in fact achieved quite a lot in the past year – some visible, some not! We have developed our British distribution network, because our current models can only be sold in the UK. We now have 70 to 80% coverage of the UK market with our sales network, which didn’t exist at all prior to the TVS acquisition of Norton. Until then, everything was sold directly to the customer from the factory.

AC: How many dealers does Norton have now?

RH: We have ten locations with partners, and two locations where we sell direct.

AC: And at the moment they’re primarily selling only the Commando?

RH: Yes. In 2023 we manufactured and sold 350 motorcycles altogether, but that also includes some V4s.

AC: Will you then be able to start exporting models shortly?

RH: No, not at all. We tried to go that route, but the engine from the Commando 961 is not Euro 5 compliant. We did spend some time investigating how to make the engine meet Euro 5 requirements, because I would love to have this great-looking Classic model spearhead Norton’s introduction into export markets, since we know we’d have customers for it. But it would require a major redevelopment of the engine and powertrain. The engine dates back to 2006 in terms of design, so it would need to be completely re-engineered, with its own supply chain, and we have therefore decided not to invest any further capital in it. We will of course build other models in coming years, but we also have to look after the profitability of the company, and changing this product so radically would impact heavily on that.

AC: So at present you’re essentially building the Commando to order for UK customers only, so when somebody puts an order down for one, you build and homologate each bike individually for the U.K. – is that right?

RH: Correct. But we also have to make certain assumptions in terms of volume in order to ensure our supply chain can deliver the parts needed to build those bikes.

AC: So how many Commandos are you presently assuming you will sell this year, in 2024?

RH: Slightly above last year. In 2023 our objective was to build customer confidence in the Norton brand, especially coming from the company’s previous situation, and I would say we achieved this. So if you look at the press test reports and the feedback we received from customers on the quality of the bikes, and how the Commando 961 model built under TVS ownership is generally perceived, it’s been positive throughout. And that is something that when we come at some point in time to launch new products, customers will look on the internet to see what is stated there about the Norton brand. They will see that we have achieved a lot in terms of the positive awareness of the brand compared to what had been the case five years ago, before TVS acquired the company.

AC: Understood. But as well as the Commando you’re now producing some 1200cc V4 models, although it seems as if this took quite some time to get under way after you launched the first such bike in June 2022?

RH: Yes, the V4SV is now in production and we are gradually delivering bikes both to new customers and those who had contracts for such bikes with the old Norton company, pre-TVS. We have committed to fulfilling those orders, and I expect that will be completed by the end of March.

AC: So how many such bikes altogether will TVS end up supplying to these customers, even though you were under no legal commitment to doing so?

RH: Including the 29 961 Classics we already delivered, we will be supplying around 130 bikes in total ordered through the old Norton company.

AC: How many, let’s call them new generation Norton V4 customers, have you delivered bikes to so far, and which models are you manufacturing?

RH: We are now building the new V4CR café racer model which was developed here in Birmingham, and is limited to 200 units, so we are fulfilling customer orders for that now. With the V4SV, my priority was to deliver such bikes to old Norton company customers first, so we are now starting to deliver to new Norton customers.

AC: How many did you deliver so far this year?

RH: At the moment we are at the level of 160-170 bikes, so we still have some orders for old Norton customers to fulfil, but we have good momentum in taking new orders, so the forecast for 2024 is to produce 350 V4 motorcycles. But then for 2025, we will expand that greatly!

AC: Indeed – so far we’ve only talked about what are essentially legacy models from the Garner era, but when can we expect to see new Solihull-developed Norton products?

RH: That is of course the main focus of the company right now, and has been already for the last one and a half to two years, in parallel with satisfying our commitments to old Norton customers. You have to remember that to develop an all-new motorcycle takes between 24 and 40 months, depending on how much you have carried over from other model families in your range. If you are in the phase that we are in now, it’s exciting times, because we now have the first functioning prototype bikes coming up shortly, as the first rideable motorcycles of our new product families. And normally, from the stage of having a rideable test motorcycle, it takes one year to build pre-production models, so our plan is at the Motorcycle Live show in Birmingham this coming November [held at the NEC Birmingham from Nov. 16-24 —AC], to give our future customers some insights into what Norton will be offering, and to display some new products.

AC: Will any of these new products still be using the V4 engine as a platform?

RH: They cannot, because it would not be profitable for us to transform our present V4 motor into a globally compliant engine. Same as with the Commando, you would need to have it massively re-engineered for it to be capable of homologation in the EU, for example, and this cannot be accomplished from a cost-effective standpoint.

AC: So this means that by the end of this year, Norton will have an all new engine platform?

RH: Not only one! Look, when we established the Norton business plan under TVS ownership we inevitably predicated more than one new engine platform. If you want to obtain any decent level of volume, you cannot do it with only one engine, you have to think about two, three, even four distinct kinds of product families to be successful. If you look at all our competitors, each of them has more than one product line. And if you look at niche manufacturers, with the higher prices they’re able to charge, there’s always a lower break-even volume. For Norton, I can tell you that the annual break-even volume is between 8,000 and 10,000 bikes per year – that’s a realistic assessment. And therefore our product families are lined up in such a way that we have good identification between them, and we have also considered our brand positioning. You always have to start with establishing the core product, and then you feed in the other product families over time.

AC: But will all the new Norton platforms be launched this coming November, or will you gradually introduce them during this year or next year, one by one?

RH: It obviously depends on the test results we have for the new bikes, but I’m confident that we have normal development times here, so I think we will have the line-up established by this November. I think we will have some rideable bikes this year to possibly make available for test purposes to outsiders, but also some show bikes which give a taste of the entire product line up.

AC: It seemed from outside a curious decision that having acquired three engine platforms when TVS purchased Norton – the Commando, the V4, and the 650 Parallel-Twins – you decided not to make the 650 twins. Why not?

RH: The main reason was the supply chain. I think that to be successful and to earn money with a particular product line you must have the supply chain in the right place, and especially for a prestige brand like Norton, for sure the right quality. At the moment, it’s quite a challenge that we are working with two supply chains – the existing supply chain from the old Norton company where we have to inspect all the parts individually and consistently focus on improving quality, and the new supply chain which then makes it much easier to pick parts and build bikes. For this reason, continued development of these particular Parallel-Twin models would have been both challenging and not necessarily profitable.

AC: When I spoke to your colleague Christian Gladwell a little over a year ago after he was appointed your chief commercial officer, he told me that in the future Norton would become essentially a 100% electric brand operating in the prestige sector of the market. Is that still the case?

RH: If you talk about 2040, I think perhaps yes – but I think we have also learnt it’s quite a dynamic market, which we have a better understanding of now. I think you have two segments in the electrification sector. One is the segment up to 40kW, which is targeted at younger riders and at providing mobility, and this has an exponentially growing volume. And then there is the higher performance segment of about 60-70kW with liquid cooled batteries, and I see a delay in the volume growth in that segment. So since our focus has to be the break-even profitability of the company, I think therefore that at the moment it feels right to step into the lower segment first. So the first Norton electric products to be made available to customers will not be high performance models, though we will of course continue to investigate the technology associated with such products. In any case. Our parent company TVS already has significant EV expertise, as evidenced by the fact that it is producing the CE-02 electric scooter for BMW, and played a significant role in its development.

AC: Has the derogation that the EU has given for E-fuel powered ICE/internal combustion engine products to continue to be sold after 2035, affected Norton’s future long term strategy?

RH: I think E-fuel is an interesting option, especially if you look at premium and luxury bikes, because the price of synthetic fuel which is likely to be much higher than current fossil-fuel gasoline is not a driving factor in purchasing such a motorcycle – it’s about the bike itself, and the brand. So E-fuel is something we will investigate, but again, our key focus at the moment is developing Norton’s new product line-up for introduction to the marketplace up to 2026, and in that timeframe I think this is too early for higher performance electric bikes to obtain the necessary volume which can contribute to break-even or profitability of the company.

AC: So consequently you’ll be focusing on the sub-40kW electric bike market?

RH: That is what I would do.

AC: Would do, or will do?

RH: Will do! That’s where our focus will be directed.

AC: So is it fair to say that Norton’s transition into an electric brand has been deferred?

RH: No, because I think my colleague’s comment was intended to state that Norton will be a full electric brand by 2040, but that on the journey towards that, we have to learn about electrification, we have to develop the right bike in the right segment where you have some sales volume. And specifically, as we globalize our dealer network in the coming years, you cannot be attractive to a distributor or a dealer with only one product, so you need a wide range of models which permit the dealer to be successful.

AC: That’s a big payroll with only a handful of bikes being built for sale - so pending the start of production of your forthcoming new models in 2025, have you engaged them in anything else besides manufacturing motorcycles?

RH: We are developing a large range of new bikes, and alongside that we are obviously building up our travel and merchandising department – we are building business processes in all areas.

AC: But with the superb array of high-tech equipment revealed by the very impressive drone tour of the Norton factory which you’ve released on YouTube are you also doing specialist machining or suchlike for outside companies?

RH: No.

AC: So it’s 100% Norton operation in this magnificent factory?

RH: It’s all Norton!

AC: So, Robert – where do you expect Norton to be three years from now?

RH: So, three years from now will be the end of 2026, and that’s going to be an exciting year for us! In 2026, I expect Norton to become a profitable company with a global reach, and while there are presently some markets where Norton is not as well-known as in the UK or USA or Japan, I expect that in these markets Norton will increasingly be seen as an iconic brand. I see a family of Norton models, I see different swimming lanes in the Norton pool, so I see a mix of ICE and EV products running alongside each other – but again, it takes time. The company which TVS acquired in 2020 was a hollow legacy, and it took us one and a half years to be in a position to build on the legacy we’d been entrusted with. So 2026 is only four years away from the restart in 2022 of the development of the company in new hands. And I think we are setting a good pace, so that in 2026 I think we will have a healthy footprint, and a profitable company, with a good fundamental structure and future capability.

AC: Are your Indian owners TVS satisfied with your progress so far?

RH: Owners are always impatient, so it can always be faster, but we must always be ready to learn, too. So the assumption was made that we could put the Commando 961 into the marketplace with Euro 5 compliance, but it was the wrong assumption, so then you have to work around that, and find other products to compensate for this. So overall, as you see, we have in every year made progress, but it’s also normal that you reach a phase where everything is going on behind the scenes over a two to three year time frame during which you develop new products, and so you cannot show big progress being made – and that’s where Norton is right now. So I ask all Norton fans to be patient, and to please wait until this coming November, when I know we will have something new and exciting to show them!