Honda’s struggle in Indian market will continue in the next fiscal, says Minoru Kato, MD, HMSI

“For customers, cost of motorcycles have been increasing due to insurance change, new brake norms and BS-VI norms which has made a negative impact on our motorcycle sales. From this point of view, we will still continue to struggle for another year”, said Kato.


New Delhi: The Japanese two-wheeler manufacturer Honda Motorcycle and Scooter India’s struggle to meet the volumes, and sustain within the sector will continue in the next financial year as well, as per a top company executive.

Discussing the company’s future course after the prolonged slowdown in the Indian automotive sector, Minoru Kato, President, CEO & Managing Director, HMSI said, “For customers, cost of motorcycles have been increasing due to insurance change, new brake norms and BS-VI norms which has made a negative impact on our motorcycle sales. From this point of view, we will still continue to struggle for another year.”

However, the company’s headquarters continues to believe in the Indian market despite the current downturn and foresee significant growth potential in the long term, Kato said on the sidelines of the launch of HMSI’s BS-VI compliant motorcycle SP125 here.

The company now has two BS-VI compliant two-wheelers in 125cc segment- Activa 125cc and SP125.

“125cc which earlier contributed 9 per cent to the total two-wheeler industry is now contributing about 14 per cent. There are customers who do not want entry level bikes but 150cc is beyond their budget (due to increased price post introduction of ABS). Therefore, there is transformation happening and consumers are shifting to 125cc bikes,” noted YS Guleria, Senior VP- Sales and Marketing, HMSI.

HMSI currently holds 39 per cent market share in 125cc segment.

Despite the segment growth, the company is yet to measure the demand as there is an increase of 11 per cent in the price of the vehicle due to BS-VI transformation. “While response have been good for Activa 125 as of now, but we really have to see long term prospect once other products also come in the market and price points are settled. Then we really have to review and measure again (increase/decrease in demand),” Guleria underlined.

Guleria further added that real demand can only be analysed post November, once their BS-VI motorcycle reaches all the touch points in the country.

Meanwhile, the company claimed to have a good festive season with retail sales witnessing a double digit growth. However, the company’s wholesales dispatches declined marginally to 0.6 per cent in October 2019.

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