Nov. 5, 2009 (The Hindu Business Line) --
, President and Chief Executive Officer, Honda Motorcycle and Scooter India Pvt Ltd (file photo). —
Murali Gopalan
Mumbai, Nov. 5 Honda Motorcycle & Scooter India’s next offering in the market will be a 110cc motorcycle that will debut during this fiscal.
Mr Shinji Aoyama, the President and Chief Executive Officer of HMSI, told Business Line that it would be a “full-fledged bike” at an attractive price. “It is not going to be a commuter motorcycle just because it will be part of the 100cc plus segment. It will be sporty for sure but the direction in style is somewhat different,” he said.
This is precisely what HMSI did with its 125cc ‘Stunner,’ which, in a rather short while, has carved a niche for itself in this category. The wholly-owned arm of Honda Motor Company (NYSE:HMC) has decided to focus on design and style aggressively which will also set it apart from its Indian sibling and market leader, Hero Honda.
The new 110cc bike will operate in a segment that is part of the big numbers game in India with sales of over 3.5 lakh units each month. Hero Honda’s ‘Splendor’ and ‘Passion’ models, on their own, take up over two lakh units with Bajaj Auto’s recently launched 100cc ‘Discover’ doing around 80,000 units.
HMSI has constantly reiterated that it would rather pay more attention to fun biking rather than basic commuting. The target audience will be the working youth and sources say the price could be in the region of Rs 45,000 (ex-showroom). “This will be a bike with the typical Honda DNA and will have no problems clocking initial monthly numbers of 40,000 units,” they add.
The following fiscal (2010-11) will see more action on the bike front from HMSI. “We may have a new motorcycle next year and less than two years from now there could be another big, exciting bike,” Mr Aoyama said. And while he did not elaborate on the subject, indications are that the other bikes could be in the 150cc-200cc range or even higher.
Clearly, there has been a complete shift in mindset as far as HMSI’s bike strategy is concerned since the time it launched the 150cc ‘Unicorn’ five years ago. There were no complaints on its performance then but what was missing was a style statement. While a section of the market was convinced the ‘Unicorn’ would give the Bajaj ‘Pulsar’ a run for its money, nothing of the kind happened and the latter only got stronger.
The lesson was learnt and HMSI realised the way forward was to focus on sporty, stylish bikes while letting Hero Honda consolidate its leadership position in the commuter segment. The results are there to see with the ‘Stunner’ and the company will now hope for an encore with the new 110cc motorcycle and the other bikes that follow.
Labour Problem
The recent labour problem at the HMSI plant threw production schedules out of gear especially in October where sales would have got a further shot-in-the-arm with the Diwali momentum.
Mr Aoyama said output was down by nearly 60 per cent during the strike period but was confident that “100 per cent levels” would resume from this month. “We are confident of meeting the target of 1.25 million two-wheelers in 2009-10. We have already done our capacity expansion and can make-up for time lost between November and March,” he added. The labour impasse was a trying period but, as he put it, “we accept the reality and try to solve the problem peacefully and quickly”.
According to Mr Aoyama, HMSI would have to think of further expansion in capacity “very soon though no detailed study had started yet”. Within the next three years (when output will have crossed 1.5 million units), the company would definitely need a new home. It remains to be seen if it will opt to continue at Manesar or move to another auto belt like Haridwar or Pantnagar in Uttarakhand.
