Honda Motorcycles and Scooters India, which has taken head on market leader Hero Motocorp by pushing aggressively into rural India through affordable bikes and more dealerships there, said operationalisation of its fourth plant in Gujarat will be delayed by about a quarter.
“Due to the elections earlier this year, there has been a delay in the start of work at the Gujarat plant. We expect to start production at the plant in first quarter of 2016 instead of last quarter of 2015 as planned earlier,” HMSI President and CEO Keita Muramatsu told The Pioneer on the sidelines of SIAM annual convention.
“We have started ground levelling work at the plant now and investing Rs 1,000 crore to set up the plant that would have an annual capacity of 1.2 million units,” Muramatsu added.
The company currently has three plants at Manesar (Haryana), Tapukara (Rajasthan) and Narsapura (Karnataka) and the upcoming new plant will increase its total annual production capacity to 5.8 million.
Explaining more Honda VP for marketing and sales in India YS Guleria said: “Though we raised our production with three new scooters, demand still outstrips our estimates.We still have a backlog of 60,000 scooters that should multiply in the festive months ahead.”
HMSI has 26 per cent of total market share and the company has over 54 of market share in the scooter segment where Honda’s Activa is still going strong, which was launched way back in 2001.
“This will be mainly for scooter and once the plant comes into operations, it will give us the flexibility at the three other plants to adjust motorcycle production to meet demand,” Guleria added.
Talking about service network and dealerships Guleria said that they will be adding 1000 dealerships this year majority of which will be in the rural area so as so connect with the common masses.
“By March 2015 HMSI will have over 3,800 dealerships and service stations across the country,” said Guleria The company is currently producing over 15,000 units a day, which is up to 20 per cent more than what it had produced in the past, with the starting of third line at its Karnataka plant.
While he declined to share a detailed product launch plan, Muramatsu said the company will launch the CBR650 motorcycle next year that will be positioned as one of the its flagship bike brands in India.