Munjal: High tech

New Delhi, June 2: Hero Honda Motors, the country’s largest motorcycle maker, today said it will introduce a new engine platform later this year which will also be produced by Honda Motorcycle & Scooter India.

Honda Scooters, fully-owned by Japan’s Honda Motor Co, produced only scooters until now. It plans to manufacture motorcycles, which many fear will slow down Hero Honda’s sales growth and eat into its dominant 48 per cent market share.

“Honda will continue to provide Hero Honda with the latest engine technology with full technical support for new product introductions,” said Pawan Munjal, MD of Hero Honda.

Munjal, however, said he would like to have a better “agreement” with Honda Motors on the export front. “We are holding discussions with them where we would like them to import from us for their export market,” he said.

“It would not be unusual for Honda’s products to eat into some of ours...Honda had three joint ventures in China and the Indian arrangement is not unusual,” he added.

Honda, which owns 26 per cent of Hero Honda, said it remained committed to the company and renewed its technology supply agreement with Hero Honda for another 10 years.

The automaker also said both its two-wheeler units — Hero Honda and Honda Scooters — would jointly work to boost market share in India and did not see a conflict in the two making similar products.

“Hero Honda has been one of the most successful two-wheeler joint ventures of Honda worldwide and will definitely be a core part of Honda’s integrated strategy to develop business in India,” S. Toshida, Honda’s managing director for Asia and Oceania, said.

Hero Honda, in which the Munjal family-controlled Hero group also holds a 26 per cent stake, is expected to produce scooters within two years.

“It’s at a very early stage and would take around two years for production to commence,” said a senior Hero Honda official.

The motorcycle maker, which has reported a better-than-expected 29.7 per cent rise in May sales at 2,12,177 units, said it expected to sell over 2,00,000 units in June. But, sales would slow in the monsoon months of July-September, traditionally poor months for the two-wheeler industry, it added.