Honda to introduce a new 100 cc bike to compete against Hero Splendor

March 26, 2013, 12:18 IST by

Honda Motorcycle and Scooters India seems in full swing to target the leadership position in the two wheeler market with the launch of a new motorcycle. Reportedly, the new bike of the auto maker will be pitched against the likes of Hero Splendor, which has been a flagship model from the end of its erstwhile partner Hero MotoCorp in the 100 cc segment. Sources close to the development process revealed that the Honda is expected to introduce a new model in its Dream series with a 100 cc engine.

Without revealing his identity, the source was quoted as saying, “The new 100cc offering is the value-engineered version of the existing 100cc bike and will be priced aggressively so it can be positioned straight at the Splendor segment. Yet again, the company is striving for higher fuel economy as the USP.” Honda has set a sales target of 6 lakh units of its upcoming bike during the financial year 2014. On this sales projection, industry experts said that it will be just 25 per cent of the yearly sales of Hero Splendor’s family whose figures stands around 2 million units. The family of Splendor includes models like Splendor+, Splendor Pro, Splendor NXG and Super Splendor.

On the other hand, amid its Dream series, Yuga and the upcoming motorcycle, Honda is planning deliver around 1.2 million units in the Indian auto market. This figure clearly indicates that the mass market 100 cc segment will cater to almost 30 per cent of the auto maker’s total sales in fiscal 2014. Interestingly, the auto maker has already revealed that is targeting sales of 3.9 million units in the next fiscal, banking on the launch of a new model in every quarter.

On this rivalry, the Managing Director of Frost & Sullivan (South Asia), VG Ramakrishnan, was quoted as saying, “Splendor has been one of the most successful models in the Indian two-wheeler space for decades. But that also shows it has been around for decades and needs revamping. Honda is in an aggressive mode, whereas Hero is the one defending. History has shown that the one on the defensive starts losing. So, Hero is bound to lose market share to Honda. The answer lies in flanking the Splendor family with an additional model that is not only aggressively priced but offers value on par with Honda, if not better.”

Refusing to comment on the move, the Vice President (Sales & Marketing) at Honda Motorcycle and Scooter India, Yadvinder Singh said, “The 100-110 cc motorcycle market is a very large market and with our existing product portfolio we have a limited representation there. We have said this before, we would be expanding the Dream series going ahead and we will be launching new products there. We can't comment more than this at present.”

At present, a customer can purchase the Dream Yuga by paying around Rs. 44,000 to Rs. 48,000, whereas Hero Splendor is available at Rs. 40,000 to Rs. 45,000. Auto analysts are of view that the upcoming model from Honda will be placed under the current generation Dream Yuga, which will surely lure the Indian buyers. It must be noted that if the two wheeler division of Honda achieves its proposed target, it will take the dominant position from the Hero MotoCorp. During fiscal 2013, the market share of Honda surged 18.64 per cent, almost 400 basis points, under the review of 14.85 per cent by the end of fiscal 2012. On the other hand, Hero witnessed a fall to 43.01 per cent in its April-February sales of fiscal 2013 from 45.17 per cent recorded in the year-ago period.

At the sidelines of a launch of CB Trigger, the Chief Operating Officer of Honda Motorcycles, Shinji Aoyama said, “Today, the market is almost 1.4 crore (units) in India. So, if (it) remains (at the) same level, no growth happening, we may become No.1 in 2015 or 2016.”

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