Honda recovers leadership in 125cc motorcycle segment in India

Honda Motorcycle & Scooter India (HMSI) has clawed its way back to the top of the 125cc executive commuter motorcycle segment, beating its arch-rival Hero MotoCorp, in September 2016.

Surging sales of the popular 125cc Glamour models saw HMSI’s arch rival Hero MotoCorp outsell the conventional segment bestseller – HMSI’s CB Shine – for the past seven months. It is known that the largest two-wheeler manufacturer held the top position in this segment since February 2016.

However, industry data now points out that while HMSI sold 91,447 units of the CB Shine models in September 2016, Hero reported sales of 80,742 units last month.

On the flip side, in August 2016, Hero MotoCorp had sold 74,693 units of the Glamour models while Honda had sold 63,606 units of the CB Shine models.

The sales numbers between the two closely competing models in the 125cc motorcycle segment only highlights the cut-throat competition in the dynamic market, which clearly rides on visible vulnerabilities including capacity constraints, discounts and product price cuts, demand-supply gaps, waiting period and many others. It is clear that these core factors define and characterise the volatile Indian two- wheeler market.

In July 2016, Autocar Professional had reported that HMSI was eyeing to recover the pole position in the 125cc segment from Hero MotoCorp. The report had revealed that HMSI had lost out in the segment due to capacity constraints of the CB Shine models. The surging demand for scooters had occupied the majority of the production lines across all HMSI plants. It was then that the company expanded the capacity at its scooter-only manufacturing facility in Gujarat (June-July 2016) relieving the load off its assembly lines in its Narsapura facility (near Bangalore).

“We have the prioritisation of what we need to produce on our production lines. Since now we have flexible manufacturing lines, we prioritise scooters within the existing production capacity since they have been growing faster with piling backlogs,” YS Guleria, senior vice-president, sales & marketing, HMSI had told Autocar Professional in June 2016.

Also it can be recalled that in November 2015, Honda had launched an all-new variant named CB Shine SP positioning it above the regular CB Shine variants. While the CB Shine SP was the 15th product under HMSI’s aggressive product launch strategy in 2015, the model was rolled out in three variants (drum brakes, front disc brake and combi-brake equipped variants) in the Rs 60,000-Rs 64,400 price range (ex-showroom, Delhi).

The company was manufacturing the CB Shine SP models at its Tapukara plant, which soon saw 100 percent capacity utilisation of these 125cc motorcycles.

“We brought the CB Shine SP last year to boost the sales for this model. Unfortunately, for the CB Shine SP, we reached peak capacity very soon. Now July-August onwards, we are adding this model at our Bangalore plant and you will see the recovery in the sales of the CB Shine model soon,” Guleria had estimated then.

On the other hand, for Hero MotoCorp, the Glamour brand is inching its way to soon become the fourth motorcycle brand with million-unit sales in the domestic market. Speaking to Autocar Professional in July earlier this year, Ashok Bhasin, head - sales, marketing and customer care, Hero MotoCorp, had remarked: "We have already launched a one-million mission for the Glamour, which is the fastest growing brand for us. We are growing at almost 29-30 percent (Glamour). It is on its way to becoming a million-plus brand soon."

It would be interesting to watch if Honda will be able to retain its top position in the 125cc motorcycle segment during October 2016 and the following months. Watch this space.