Honda Motorcycle to take up study on second facility in 2009

New Delhi: In anticipation of its plant reaching full capacity by 2010, Honda Motorcycle and Scooters India (HMSI), a subsidiary of Honda Motor Co, Japan, said that it would take up a feasibility study in 2009 to decide on a second manufacturing facility in the country.

“By 2010, our production capacity at Manesar would reach its full capacity of 1.2 million units.

“Considering that for a plant to be operational would take two years, we would take a feasibility study in 2009 if the new facility has to be operational by 2011,” said Mr Shinji Aoyama, President & CEO, HMSI.

HMSI, which currently has slightly less than one million capacity, expects its plant to run at full capacity in the next two-three years.

HMSI sells two models in motorcycles, 150cc Unicorn and 125cc bike Shine, and three models in the scooters segment — a 150cc Eterno, 100cc Dio and 100cc Activa.

Sales outlook

Mr Aoyama said that the company expects to close the current fiscal clocking a sale of 2.7 lakh motorcycles and 6.1 lakh scooters, which is expected to grow to 7 lakh scooters sales and 3 lakh motorcycles in the next fiscal.

The company that has in all five products in its current portfolio said that it would add two more — one motorcycle and one scooter — in the next fiscal.

While the scooter that HMSI intends to launch in February would be showcased during the Auto Expo next month, the company did not reveal any details of the bike that is slated to be launched in the first half of next year.

Commenting on the company’s plans to launch a bike in the 100cc segment, Mr Aoyama said that it would be introduced in the market in the next two years.

“The trend has been that the base of the 100cc market is declining, with the preference of consumers changing. But, it is going to stay.

“There is enough room for various players like Bajaj, Hero Honda, and TVS to be in this segment,” said Mr Aoyama, answering a query if the company’s entry into the 100cc segment would create any clash of interest with Hero Honda, a joint venture between the Hero Group and Honda.

Dealers, exports

Elaborating on the company’s expansion plans in terms of dealer network and exports, Mr N.K. Rattan, Divisional Head, Sales and Marketing, said that the number of dealers would increase from 300 to 320 in the current fiscal.

With regard to exports, Mr Rattan said that the company expected exports to remain at the same level of 32,000 vehicles in the next fiscal.

As a part of its investments, that was announced earlier, HMSI is investing Rs 300 crore in the next two-three years in capacity expansion and new model launches.

Meanwhile, the company is also exploring launching its premium bikes in the country over the coming two-three years but would continue to remain focused on the mass market.