HMSI to commission 600,000-unit dedicated-EV assembly line at Karnataka plant in March 2024

Honda Motorcycle and Scooter India (HMSI) has revealed that the company is building a dedicated-EV facility at its Narasapura plant in Karnataka. Christened the 'Factory E' - the assembly line will be equipped with state-of-the-art machinery and boast high levels of automation to achieve maximum production efficiency when it begins mass production around mid-March 2024. 

HMSI, which will initially install a capacity of 600,000 units at Factory E, anticipates achieving annual electric vehicle (EV) production volumes of 1 million units by 2030, in line with the projected growth in the e-two-wheeler category in the country. Honda's Factory E will also heavily rely on solar power, and ensure up to 98 percent green energy consumption. 

While an automated battery transfer system is being set up at this facility, HMSI will assemble the e-motor powering its EVs in-house. Without disclosing the investment into the new line, Atsushi Ogata, President, MD, and CEO, HMSI said, "We chose Karnataka as the EV manufacturing factory as it is quite a big location amongst our four plants. He further added that HMSI will initially purely focus on the domestic market for its EVs, and does not eye exports in the near term.

At a media event held on March 29 at its Global Resource Factory in Manesar, the outgoing HMSI boss Ogata, also announced the company's EV game plan for India, where Honda will kick off its EV assault by launching two electric two-wheelers - both fixed and swappable-battery types - in both mid- and high-speed categories.

While the first mid-speed e-scooter with a fixed-battery setup is expected to be introduced around March 2024, the company is likely to roll out a swappable-battery e-two-wheeler (a moped-scooter similar to the Honda Navi) by September 2024.

Strong focus on localisation

Although challenging, HMSI will stress upon high localisation of the EV components in its upcoming electric two-wheelers in India. The company says the battery pack, power control unit (PCU), motor, charger and contactor are to be locally sourced. 

"It is actually quite difficult to localise some core EV components such as motor magnets and battery enclosures, and therefore, the initial gross localisation percentage is going to be lower compared to ICE vehicles. We are trying our best to avoid importing from China", Ogata said.

While the fixed-battery e-two-wheeler will rely on home charging and charging at Honda's 6,000-strong 'Workshop E' touchpoints, HMSI will depend on Honda Power Pack Energy India (HEID) which is building a battery swapping ecosystem in the country. 

The Bengaluru-based HEID, which was incorporated in November 2021, has already set up 23 stations under the 'Honda e:Swap' brand. The company has partnered with Hindustan Petroleum and the Bengaluru Metro Rail Corporation to install these swapping points at fuel stations and metro stations, respectively. 

HEID aims to saturate one city with a dense network of swapping stations before moving into a new city. In CY2023, HEID eyes setting up 70 Honda e:Swap stations in Bengaluru and then targets Tier-1 cities in South India before venturing to the rest of the country in its next phase of expansion.

Other than fixed-battery e-two-wheelers, HMSI is betting big on the battery-swap solution for its upcoming EVs as it believes ASEAN countries, including India, Indonesia, Thailand, and Japan among others are slated to lead the adoption of battery swap solutions for e-two-wheelers. HEID is also offering its Cloud-connected swappable batteries to e3Ws as well.

Dedicated EV workshops

In line with its plan to introduce brand-new EVs in the Indian market, HMSI is also bracing the aftersales infrastructure with dedicated e-two-wheeler workshops, christened 'Workshop E' that will also house EV chargers. The company aims to set up 6,000 such touchpoints in the country by the time the first product is introduced, to offer seamless aftersales to its EV customers.

"The Workshop E concept and a sustainable battery-swapping network are critical to ensuring a long-term viable EV business in India. We are in discussions with our existing dealers for establishing the Workshop E footprint," Ogata said.

The company is also exploring possibilities of installing smaller format EV swap stations for deployment as its Workshop E touchpoints to support demand for electric two-wheelers in the future. 

Optimistic growth outlook

HMSI is witnessing double-digit growth in FY23 and is poised to close the fiscal with 4 million-unit sales. The company recently introduced new OBD-II compliant models including the new Shine 100 and Activa 125. CB350 and CB350 RS - two of its BigWing Silver Wing offerings have also been upgraded to conform to the said mandate.

The company is in the process of installing an additional 600,000 unit capacity at its Vithalpur plant in Gujarat, and aims to commission this capacity by the festive season of CY24, to grow its combined capacity across four plants - Manesar, Vithalpur, Tapukara and Narasapura plant to 5.8 million units, as it aims clocking 5-million-unit sales in FY24, on the back of anticipated strong demand for the recently-launched Shine 100, as well as other products like the Activa.

HMSI is confident of switching over it's entire portfolio in India to OBD-II norms and E20 compliance by H1 FY24, and aims to also expand its export footprint from existing 38 to 58 countries by shipping 20 models from India compared to 18 in the present day.

While Australia, and New Zealand are some of the key export markets for HMSI, the company is also supplying powertrains to global markets from the Gujarat plant. While its aggressive foray into the EV segment in India will unfold over the next few years, HMSI will also sustain momentum in conventionally-powered two-wheelers by also bringing flex-fuel two-wheelers to the Indian market. 

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Honda Motorcycle & Scooter India to start new manufacturing line in Gujarat, to announce EV plans by the end of March