Honda Two-Wheelers Announces Rs. 800 Crore Investment For 2018-19

Honda Motorcycle and Scooter India (HMSI) has announced plans for the 2018-19 fiscal year, earmarking Rs. 800 crore to prepare for Bharat Stage VI (or BS-VI) emission regulations, as well as consolidate on the brand's growth in India and expand on the current production capacity. Announcing the company's growth over the past one year since he assumed the top job, HMSI President and CEO Minoru Kato said he was satisfied with HMSI meeting and exceeding all expectations during 2017-18, with India now contributing 30 per cent to Honda's global sales.

HMSI President & CEO Minoru Kato, flanked by Yadvinder Singh Guleria and Prabhu Nagaraj

"India is already the Number One contributor to Honda's global two-wheeler business. Our record sales have set a solid foundation in 2017-18 and Honda 2wheelers India will further consolidate its position in 2018-19 as we get ready to lead the biggest paradigm shift of 2020. Moving ahead with the same momentum on back of customer demand, we will invest close to Rs. 800 crore as we aim for double digit growth for the third consecutive year in a row as well," the HMSI President and CEO said.

Honda's market share increases by 2 per cent in 2017-18

In 2017-18, Honda has surpassed expectations by growing at 20 per cent, while the overall two-wheeler industry grew at 15 per cent, Kato said. Honda scooters are leading this growth with the Honda Activa cementing its position as the Number One scooter in the market, with 57 per cent market share. Honda motorcycles are also witnessing rapid growth, posting almost double the industry growth of 14 per cent.

"2017-18 was a historic year for Honda in more than one way. Honda 2Wheelers India is the only two-wheeler company in the world to grow at a pace witnessed never before, adding 1 million plus incremental customers in a single year. Led by strong demand in both domestic and exports front, Honda's sales apexed at 6,123,886 units with 22 per cent growth. Honda successfully consolidated leadership further in scooter segment while aggressively gaining new motorcycle customers. The aggressive launch of four brand new models, new capacity infusion and addition of 500 new outlets propelled Honda's growth story further and set the solid foundation for future growth," said Yadvinder Singh Guleria, Senior Vice President - Sales and Marketing, HMSI.

HMSI will upgrade 18 existing models and launch one all-new product in 2018-19

HMSI will upgrade 18 existing models in 2018-19 and launch one brand new model in 2018-19, although the company is tight-lipped about details of the all-new product. As part of the plans for the current fiscal, Honda will focus on increasing production from the existing plants, while preparations to meet BS-VI regulations and equipping the next generation of two-wheelers with fuel injection will take priority. By 2020, Honda expects the two-wheeler market to undergo some correction, as prices of all two-wheelers will see a hike with the introduction of fuel-injection to meet BS-VI norms, and the introduction of ABS in motorcycles with engine capacity of 125 cc and above.

Honda will have increased focus on promoting motorsports in India in 2018-19

HMSI will also focus on network expansion in the current financial year, increasing its domestic footprint to 6,000 touch points, with focus on the rural market. Right now, around 20 per cent of HMSI's two-wheeler sales are from the rural market, and the company will focus on increasing this contribution as well.Although no new assembly lines are expected to be added to Honda's existing plants, the focus will be on increasing productivity from the existing plants.

Honda also announced the creation of a new Brand and Communication vertical within the organisation which will oversee Road Safety Promotion and Racing DNA of Honda through motorsports initiatives.The Brand and Communcation vertical will be headed by Prabhu Nagaraj, Vice President of Brand & Communication, HMSI.  In 2018-19, Honda will focus on promoting the culture of motorsports in India, and several new announcements are expected soon, including the setting up of a India Talent Cup, as well as India Talent Hunt in motorsports.