Journey from Hero Honda to Hero v/s Honda

In 1984, Hero Cycles graduated from a Bicycle maker to a Motorcycle manufacturer by collaborating with Honda Motor Company Ltd of Japan. The first product post the collaboration agreement was launched in 1985 – named Hero Honda CD100. The rest we can say was history – By 2001, Hero Honda grew to be the world’s largest 2 wheeler company! The association churned many such milestones in the Indian market and became a household name pretty quickly. Like every marriage, this association had some bitter experiences in between and later could simply not cope up with the increasing differences. While Hero wanted to taste a bit of exports market and strengthen its inhouse R&D; Honda found it demeaning its global operations. The duo decided to separate ways and dissolve their Joint Venture in December 2010. The 26-year long pact ended on a quiet note with strong individual aspirations to dominate the local market.

Five years post the split, Honda Motorcycles did everything possible in the book to overtake the ex (Hero MotoCorp’s) dominance in the Indian market – though the effort was monumental and appreciable, the Japanese has still a long way to achieve the feat. The efforts taken by Honda for the attempt to become the market leader was mind-boggling. In past 5 years, it expanded its outlets from mere 800 nos to 4,500 sales outlets! In 2015, Honda’s global sales of all products was 28 million units out of which global 2wheeler sales stood at 17 million units. Today, 25% of the total Honda two-wheelers sold across the world come from India. 3 manufacturing plants were opened in last 4 years! – Plants opened at Tapukara Rajasthan (in 2011), Narsapura Karnataka (in 2013) and scooters only plant at Vithalpur Gujarat (2016). These drastic steps allowed HMSI to climb to a market share of over 26% and stand as a real threat to the Indian Leader (Hero Motocorp). See the climb for yourself here –

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Source: Business Standard

The competition was intensified with Hero Motocorp’s response in said time and the Indian MNC challenged HMSI in their own game – by attacking the baseline (scooters). Hero’s retaliation shook the Japanese major quite hard and the scooter market share statistics changed within 6-month time frame! –

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Source: Business Standard

In September last year, Hero expanded its scooter offering with the launch of two products — Duet and Maestro Edge. Until then, the country’s largest two-wheeler maker had two scooters to offer: Pleasure and Maestro. These scooters were indigenously developed by Hero’s R&D and the long term plan is to dominate the scooter market as well. Other players jumped into the game as well and have gained pretty significantly in past 1 year – say TVS’s Jupiter and Yamaha’s Fascino were instrumental in the growth story of their respective OEMs in the previous fiscal. The latest OEM-wise ranking and Market Share data is here –

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*FY16 (Apr’15-Feb’16) and FY15 (Apr’14-Feb’15)

Hero aware of the path ahead, has taken drastic measures to improve its R&D. It has set-up its first dedicated Rs 850-crore R&D centre last month. The 247-acre facility near Jaipur will have 600 engineers by the end of this year. Hero had a tiny three-acre R&D setup before the Jaipur centre came up. The centre will be led by Hero’s chief technology officer Markus Braunsperger, who came from BMW in 2014 after a 25-year-long stint in R&D, production and strategy roles.

See how both the biggies fare on various factors as on date:

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Source: Business Standard

While both Hero & Honda have intensified their efforts to command dominance in the domestic two wheeler market; the consumers are at advantage as they’ll receive world class products and their demand will be given paramount importance. We at Auto Punditz are happy to see the way two-wheeler industry is shaping in the subcontinent and wish that the better OEM will win the race!

2 thoughts to “Journey from Hero Honda to Hero v/s Honda”

  1. Its a really good presentation. Can u also do the same for tvs, bajaj and royal enfield to see where they stood and where they are moving?

    1. Hi Rama. Two Wheeler sales Statistics and Top 10 sellers data has been published today. Hope it may add value to the performance analysis of all OEMs.

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