Honda Motorcycle & Scooter (HMSI), which has scripted success in the scooter segment with the Honda Activa, is looking to introduce multiple products in the motorcycle segment to take on former partner Hero MotoCorp.
The company has concluded a study to introduce an entry-level product, where it has limited presence, with CD110. HMSI is also exploring options to grow its footprint in the 150-cc segment, which is seeing increased traction from customers.
“Of course, we have a low-end model CD110, but relatively it’s very weak compared to our competitors. It means we have never matched demand with such kinds of customer groups. So, I had committed to investigate how to enter this low-end MC segment. This feasibility study (is) already done so we are going to develop this kind of motorcycle in the low-end category”, Atsushi Ogata, President, HMSI said in a recent interaction.
With sales of 4.2 million units of entry-level motorcycles (with engine capacity more than 75 cc and less than equal to 110 cc) comprised 56% of all motorcycles sold in the local market in the first 10 months of the ongoing financial year. Rival Hero MotoCorp commands a lion’s share selling three out of every four motorcycles in this category. HMSI’s share in the segment stands at a modest 3.6% currently.
The Japanese auto major fared better in the 110-125 cc segment, where it dominated with sales of 924,787 units between April and January FY22. Overall, Hero MotoCorp dominated the motorcycle segment with 48% share till January FY22. HMSI comes in third in the sales tally with 16%.
Ogata added, “In 150cc segment, we have a portfolio, X-blade, Unicorn. Unicorn is very good product but its only known in some specific areas like West, East and South and not the whole of India. So, we need to focus more on the 150 cc line up. We are investigating this segment too and you will hear (from us) sooner or later.”
At the higher end of the market, HMSI has been buttressing its product portfolio to challenge Royal Enfield in the mid-weight motorcycle segment where HMSI currently has two products CB350 and CB350RS. With the new portfolio of locally produced midsize motorcycles, the company is targeting sales of 300,000 units per annum in the category in the next three years. To expand reach, HMSI – which currently has around 70 Big Wing outlets bikes – will expand presence to 300 customer touch points in the next three years.
Separately, HMSI is also examining the market for electric two-wheelers and consumers will be “able to see an actual HMSI EV product within the next financial year.” The decision from HMSI to enter the EV market in India comes at a time when several mainstream players such as Hero MotoCorp, Bajaj Auto, TVS Motor Company and startups like Ola Electric have announced aggressive plans in the segment.
In the two-wheeler segment, companies such as Hero Electric and Electrotherm have been selling electric scooters in India for several years now. But sales have remained low at about 143,837 units in the last financial year, compared with 15.1 million two-wheelers powered by fossil fuels.
With battery prices coming down and central and state governments announcing incentives to encourage faster transition to e-mobility, industry stakeholders said the potential for conversion is massive in a country where 21 million two-wheelers were sold prior to the outbreak of the pandemic in FY19.
Honda Motorcycle & Scooter India (HMSI) is the second largest two-wheeler maker in the country with sales of 2.87 million units till Jan FY22. Scooters account for nearly 60% of volumes at the company. HMSI accounts for one out of every two scooters sold in the local market currently. Hero MotoCorp’s has a market share of around 8% in the category.
Also Read:
An arbitral tribunal has been formed by the Delhi High Court to resolve the dispute between Hero MotoCorp and Hero Electric. Three retired judges – Indu Malhotra, Deepak Mishra, and Indermeet Kaur – are part of the tribunal, sources aware of the development told ET.
