Honda Motorcycle & Scooter India expands network footprint ahead of new 100 cc launch
With expanded reach and new products, the two-wheeler major aims to inch closer to the Number One position held by Hero MotoCorp
As the race for the Number One position gets hotter between Hero MotoCorp and Honda Motorcycle and Scooter India (HMSI), the Japanese two-wheeler major is ramping up its dealership footprint across the country just ahead of its mass-market motorcycle launch scheduled for 2023.
Already a leader in the 125 cc motorcycle segment with over a 50 percent share, Honda Motorcycle will be banking on the new 100 cc model and expanded network to bring in the additional volumes and inch closer to its rival Hero MotoCorp.
According to a filing with the Registrar of Companies, HMSI had boosted the number of its certified main dealers (AMD) to 1,025 in FY22 by opening 11 new locations in both urban and rural areas. It has established 119 additional associate dealers (AD), 10 Best Deal (BD) outlets, and 239 approved service centres during the reported period, bringing the overall footprint to 5,246 touchpoints at the end of FY22.
The network footprint of its Silver Wing premium business division has also strengthened which has reached 100 touchpoints across both-Big Wing Topline (for premium motorcycle range from 300 cc to 1,800 cc) and Big Wing (for mid-size motorcycle segment) retail formats.
In the month of September, Honda Motorcycle & Scooter India had registered 2.85 lakh units surpassing Hero MotoCorp's 2.51 lakh units as the largest two-wheeler retailer for the month.
At the end of September, the gap between Hero MotoCorp and Honda Motorcycle & Scooter India stood at four lakh units. Hero MotoCorp had sold about 2.7 million vehicles in the first six months of this financial year and the Japanese two-wheeler major had dispatched 2.3 million vehicles.
With scooters making a gradual recovery after opening up of schools and colleges and new products in the pipeline across the entry and premium end of the market, Honda Motorcycle is eyeing incremental volumes both demographically and geographically.
In FY22, Honda Motorcycle established a new ‘Overseas Business vertical’, by integrating its SEDBQ (Sales, Engineering, Development, Purchasing & Quality) functions with an aim to establish India as a global export hub for Honda Motor Company.
In the year under review, HMSI increased its sales volume to 4.0 million units versus 3.8 million units sold in FY21. The revenues for the year grew marginally to Rs 21,160 crore. However, an increase in exports helped the company post over a six times growth in profits to Rs 999.8 crore.
Reviewing the financials for FY22, the directors' report stated that despite signs of moderation, FY21-22 continued to impact business momentum due to challenges arising from both the demand & supply side.
“While the first quarter was about driving optimism across dealer networks and markets in view of the staggered reopening of the economy, the second quarter hinted towards signs of normalcy as we entered the festive season with renewed spirits. Rising resiliently above past challenges to regain the lost momentum, the third and fourth quarters witnessed green shoots of progress,” added the report.
The company claimed that by bringing the synergies of new product development and unlocking new capabilities in areas like exports business, Honda Motorcycle and Scooter has moved ahead to clock over five crore cumulative customers in 2021.
With retail expansion plans well in place, HMSI also seems to have also accelerated on its skilling objective. Through 24 training centres scattered across the country, HMSI trained over 51,049 dealership personnel simultaneously to improve the skill level of their workforce. By doing this, the company claims, it is able to offer high-quality repairs and better customer service in the field.
Additionally, the Company adopted Online Dealer Management System (HiRise) at 10 primary networks, 33 premium motorcycle business (PMB) dealers, three parts distributors, and 454 secondary networks in 2021–2022, to manage such a large network with significant sales and service volumes.
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