Shinji Aoyama does not mince words. Nor does he evade tricky questions. The new president and chief executive officer of Honda Motorcycle & Scooter India (HMSI) believes that the best is yet to come from his company. At one level, it is not bad going for an entity that is less than a decade old.
After all, HMSI did seven lakh units in 2006-07 and is targeting close to a million this fiscal. It is the clear market leader in the gearless scooter segment but has not created the same magic with its bikes. Of course, the company has had its share of bad luck in recent years with a labour strife that crippled production and threw projections out of gear. Yet, it is to its credit that it bounced back quickly though it is in dire need of a big success on the motorcycle front.
PRODUCT PRIORITIES
For the moment, though, a new scooter will be the sole offering this year while greater attention will be paid to the Unicorn and Shine in terms of styling and new features. The latter has been reporting better numbers lately (to the tune of 16,000 units a month) but it is the Unicorn that has been a huge disappointment. And to think that it was tipped to upset the Bajaj Pulsar at the time of its launch!
Aoyama agrees that the bike’s showing has been a letdown but insists that all this is part of HMSI’s learning curve in India. What could be a sore point is that it had features specific to HMSI and intended to be different from models in the hugely successful Hero Honda stable. “Although designed differently from Hero Honda’s products, neither the Unicorn nor Shine were able to get the right market connect. The mono suspension of Unicorn still does not have a high perception though it is different from competing models in this segment. We should have possibly made more efforts to promote its features,” he says.
The Unicorn could have also got the cold shoulder in the market because its styling was a big letdown. At that point, HMSI was reportedly categorical that it was not intended for youngsters but the more serious/conservative corporate executive. However, as Aoyama says, while it did not work in terms of volumes, the few owners of the Unicorn are a happy lot.
BIGGER VOLUMES
HMSI’s next bike will (in all likelihood) be a 100cc offering and it is the new CEO’s reasoning that entry level motorcycles will continue to be the volumes segment in India. “Bikes with higher engine displacements have some demand which could grow in the coming years. However, they may not be able to fit the bill in terms of really large volumes. We are also interested in bringing in powerful motorcycles but from a business point of view, believe that lower displacements still hold the key,” he insists.
Aoyama makes no bones about the fact that HMSI must strike the balance between market realities and fun bikes. “We had better focus on lower displacements and it is my belief that leading the market does not mean introducing powerful bikes alone but could be achieved in terms of better technology for lower displacement models too,” he reasons.
Of course, competitors like Bajaj Auto have a different point of view on the subject especially in the context of recent statements that the time has come to wean customers away from 100cc bikes. The company is now set to launch a new motorcycle though there is still no official word yet on its engine displacement.
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MILEAGE IS THE KEY
Will Bajaj be able to pull it off? Aoyama believes that mileage holds the key and says that it is difficult to believe that this can be achieved with a more powerful bike (Bajaj has recently indicated that the bike will have the digital twin spark swirl induction technology).
“Can Bajaj offer a 125cc motorcycle at the price of a 100cc bike? Honda’s experience says otherwise. After all, a 125cc engine is heavier than a 100cc and, even with good design, cannot be cheaper,” he says. The next few months could see Bajaj divulging more details on its motorcycle and, finally, the market will be the deciding authority.
Aoyama grins good-naturedly when I tell him that Indian two-wheeler manufacturers are quicker to react to changes in market demand. “In Honda, we always keep an eye on the market as is the case with Bajaj or TVS. I agree that they are very quick to react but the key eventually lies in providing top quality,” he says. He refers to Hero Honda’s digital mirror (developed by Honda) as an example. “Customers will eventually understand the difference in quality between this and other brands though this takes time,” he says.
It is on the subject of Hero Honda that I press him for more details. Speculation is rife that the two companies are on the verge of splitting but Aoyama refuses to be drawn into this discussion. Instead, he chooses to draw the distinction between HMSI and Hero Honda. “HMSI would ideally like its products to reveal the Honda philosophy a little more. Our Unicorn and Shine do not actually reflect this in the Indian market. Hero Honda products have their own philosophy but those of HMSI should include the Honda DNA. We would like to change this situation as people expect us to do so,” he says.
BEST IS YET TO COME
The Honda DNA, he adds, stands for the highest quality in the market and this is what he wants HMSI to do. “The best is yet to come. Hero Honda has half of Honda’s DNA, given that this is a joint venture with the Hero group,” he says.
Though the two companies followed different routes in product strategy, there has been a greater convergence of late. For instance, the Unicorn’s engine was used in Hero Honda's Achiever.
However, Aoyama retorts that an engine does not define a product. “Hero Honda is a good company and HMSI holds it in a lot of respect. Both are Honda companies,” he explains. Hence, HMSI will also end up making 100cc bikes which is the bastion of Hero Honda. “We want to take a different direction but will the market allow us to do so? We may want to go in for powerful bikes but cannot get the numbers,” he says.