Muramatsu clarified that HMSI’s future strategy is not to compete with the capacity of Hero Honda, its former joint venture partner. “What is more important than quantity is quality and customer satisfaction, specifically quality products and the quality of sales and service, and we will like to improve them still further.” HMSI meanwhile is still evaluating its entry into the 100cc mass motorcycle segment and will take a call on it based on buyer needs by next year. The two-wheeler maker recently launched its first sportsbike in India, the CBR250R that has received a good market response. “We have already received 6,000 bookings and are ramping up production to 2,500 units per month,” remarked NK Rattan, vice-president – sales, marketing and corporate affairs. The company’s marketing strategy is to ramp up production capacity to tackle the huge backlog of orders, of over three months for the CB Twister motorcycle and Honda Activa scooter and to improve its service setup in more geographical areas before targeting new products. Hence its plans to set up the second plant at Tapukara, Rajasthan followed by a third plant at Narsapuram in Karnataka.

The Tapukara plant, which will manufacture the Activa scooter and CB Twister and Shine bikes will become operational from July 2011. In the initial phase, the facility will produce 0.6 million units per annum that will be ramped upto 1.2 million units by March 2012 with a manpower strength of about 3,200, and will play an important role in Honda’s global operations. Utilising production technologies refined at the first plant as a starting point, HMSI says it will strive to improve process ergonomics and employ more advanced automation and other measures to reduce the burden on associates at the second plant. It will also be a more environmentally responsible plant by proactively reducing energy consumption during production. The third plant, to come up in Karnataka, will become operational in the first half of 2013, with an annual production capacity of 1.2 million units. This will increase HMSI’s total annual production capacity to four million units, including 1.6 million units at the Manesar plant.

“India has a growing economy and the penetration of personalised transportation is still low, which makes it very good for the two-wheeler business,” said Rattan. HMSI had recently opened its used bike business and Rattan remarked that it is still in a nascent stage with 300 units sold at five dealer outlets. Going forward, the company’s target is to step up this figure to 1,500 units over 15 dealers. HMSI has so far invested Rs 1,860 crore in its Indian operations.