Honda Gears up to become No.1 in Indian Two-wheeler Industry

India became world's largest two-wheeler market last year with around 14 million unit sales by overtaking China, which is selling 12 million odd two-wheelers annually. Thus India becomes the biggest battle ground for the big players like Honda, Yamaha, Hero MotoCorp and Bajaj, as China has so far been a difficult market for the overseas companies. Why India is so important is the fact that these four companies are claiming the No.1 slot not only in India, but also globally. Honda is the world's largest two-wheeler company (in volume), Hero MotoCorp holds No. 2, Yamaha at No. 3 while Bajaj occupies the fourth slot. So, the brand which will have the biggest market share in India, will also rule globally. On the other hand in China, the market is crowded and fragmented with over 50 players, and demand of cheap, low-quality bikes make it an unattractive market for technology-focused MNCs like Honda.

Hero MotoCorp is the largest two-wheeler manufacturer in India, while Honda Motorcycles and Scooters India (HMSI) holds the seconds slot and getting momentum day by day. Earlier HMSI announced that they will be the No.1 player in India by 2020 with a 20 million units sales per annum. But recently Shinji Aoyama, operating officer of Honda Corporation's motorcycle business, announced at CB Triggers launch ceremony, "Very soon, we will make the dream to become No. 1 [in India] true." Aoyama was the former head of Honda Motorcycle and Scooter India (HMSI), he served as HMSI CEO between 2007 and 2011. "Given the current scenario in India, I believe it will not be 2020, but 2016 or even 2015 by when we will attain No. 1 position here," he told ET.

HMSI claims are not just claims, Honda knows how to rule markets, they are the leader in every country they operates except China. Brazil, which shares its market dynamics with the Indian market, Honda has a dominant 80% share, and a deciding 50% in Indonesia. If you look at Honda's growth path of past two years, after the separation with erstwhile partner Hero MotoCorp, Honda has overtaken TVS and former No. 2 Bajaj Auto. Honda took only two years to reach nowhere to the second-largest two-wheeler company in India. At the moment Honda has a market share under 20 per cent, which is way lesser than that of the Hero MotoCorp's 46 per cent, but Keita Muramatsu, CEO, HMSI thinks different, "We had 61% of the Indian market [before the breakup with Hero Honda]. We are under 20% today. We have to be No. 1 here. This is our dream."

So, as Mr. Aoyama said Honda won't take long to reach the No.1 slot, and we agree with Honda on this that Bajaj is the potential threat not Hero as Honda knows the working style and product strategy of the Hero MotoCorp, and possibly have all the counter strategy against them. But Bajaj Auto is rising as high as Honda and has capability to compete with Honda not only in India, but globally as well. So, it will be interesting to see, which brand will rule the world's largest two wheeler market- India.

Source: ET