India Largest 2-Wheeler Market For Honda In The World

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NEW DELHI: India has become the biggest two-wheeler market in the world for Japanese major Honda, nearly three years after it decided to go solo following the split with Munjals of Hero.

Sales in India have emerged as the highest for Honda across its global operations, led by a strong demand for its scooters and a slow-but-gradual pick-up in motorcycle volumes.

Honda's fully-owned Indian subsidiary, Honda Motorcycles and Scooter India (HMSI), emerged as the top-seller for the company in July, and followed the feat in August. The leadership assumes significance considering HMSI was at the fourth place in Honda's twowheeler pecking order just three years back with top three ranks being occupied by Indonesia, Vietnam and Thailand.

"The high demand in India has helped us achieve an aggressive growth rate, which has taken us to the top position in Honda's two-wheeler business," Keita Muramatsu, president & CEO of HMSI, told TOI.

Indonesia had been the top market for Honda in two-wheelers till India displaced it in July.

HMSI - the second-biggest two-wheeler maker in India behind Hero MotoCorp - sold 3.8 lakh units in July (up 33% y-oy) and 3.9 lakh units in August (26% up y-o-y).

HMSI's strong run will mean the company will contribute 25% of Honda's global two-wheeler sales this fiscal against 22% in the previous fiscal. HMSI expects to sell 45 lakh units this fiscal against 37 lakh units it sold in 2013-14.

Muramatsu said strong performance of scooters, especially the 'Activa' model, has played a key part in fuelling the company's growth. Scooter sales have been the backbone of HMSI's operations in India and have single-handedly worked at reviving the dying segment after the exit of Bajaj Auto.

"Changing lifestyles, rising number of female riders and increased demand from semi-urban regions have led the growth in scooter sales," Muramatsu said.

Y S Guleria, VP (sales & marketing) of HMSI, said the company is now boosting vehicle production as well as presence in the market as it plans at least one new model every quarter. "We have an annual production capacity of around 4.6 million units. The new factory in Gujarat, which should be operational by the first quarter of 2016, will add an additional 1.2 million units to our capacity." The company, which has invested around Rs 6,200 crore, is rapidly expanding its presence in India and getting deeper into smaller towns and rural areas.

Image: Zigwheels
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