Honda plans its next plant in Karnataka

Auto Manufacturing could get a boost in Karnataka as Honda Motorcycles and Scooters India may set up a manufacturing plant at a location close to the IT capital of India, Bangalore.  For the Southern state primarily known for the IT sector mainly concentrated in and around it’s capital, this bit of news could come as a welcome break as investments in the auto manufacturing space have been few and far in between, with most automakers preferring the neighboring state Tamil Nadu, for their investments.

According to sources in the know about this project, Honda’s two wheeler manufacturing unit in Karnataka could entail an investment of close to INR 1,000 crores. Also, a large number of jobs are expected to be created with the setting up of the manufacturing plant which would definitely boost the local economy. Honda, it seems is on a rapid expansionist spree with it’s second Indian plant at Rajasthan all set to go on stream on the 1st of June.

Silver Colour Honda CBR250R

Honda has been making no bones about the fact that it wants to be the top player in the Indian two wheeler market in the times to come and having exited it’s long time joint venture with the Hero group, Honda seems to be all set to work towards furthering it’s goal of being numero uno in India. So, the third plant being planned comes as no surprise although most two wheeler industry analysts estimated the third plant sometime in 2015-16.

As a prospective Honda two wheeler buyer, you can expect waiting times to go down if Honda’s expansion plans work according to plan and also the spare parts situation improve. Currently, Honda Activa buyers are havingto wait for 2-4 months for delivery even as we’re hearing many harried customers of the Honda CB Twister complaining about lack of spare parts, especially in times after a accident. Hopefully, Honda will be able to address these issues on a war footing once it’s production expansion begins.

Scooters India

 

The iconic Scooters India (SIL) could be up for revival with the government looking to divest its stake fully to a player who can infuse technology and funds. The move, if implemented fast and successfully, could see Congress challenge the Mayawati regime on the industrialization plank ahead of the 2012 elections. Scooters India was a leading manufacturing unit in Lucknow which produced the fashionable Vijay scooters before slipping into the red. Today, it manufactures three-wheelers and has a market share of 2.7%, employing 1,255 people. Though owned by the central government, it has become a symbol of general decline of Uttar Pradesh.

According to sources, the Centre would shed its 95% equity in the company to a strategic partner who would bring in money and technology to restore the cutting edge to the one-time giant. The Centre would identify the investor and decide the terms. The government feels the company, which lost its sheen after it stopped making two-wheelers 15 years ago, can hope for revival in long-term if money and technology are injected. Under the new owner, the company would offer a Voluntary Retirement Scheme (VRS) to 900 workers to attract joint venture partners. The VRS would cost Rs 78 crore, while other employee benefits would be borne by SIL.

It is expected that the symbolic value of SIL's revival among voters can paint broader agenda of Congress for the state, while taking a dig at the local government. The Rail Coach Factory, which made news for facing resistance from UP, would roll out its first wagon soon, and Congress is eager to make political capital over BSP ahead of the 2012 assembly polls. Industrialization and employment are votecatchers which go with the Congress campaign that development in UP has slipped under regional outfits. Industrialisation had triggered a major political tussle between Congress and BSP when CM Mayawati resented that the Congress first family was setting up units on its turf of Sultanpur-Rae Bareli-Amethi. UP blocked land acquisition for the rail factory in Rae Bareli and it led to a showdown when Sonia Gandhi threatened to court arrest in protest. The state then gave in.

A revival of Scooters India can appeal outside the limited Gandhi family turf to highlight the Congress agenda for the state, party observers said. The Lucknow-based unit attempted to reinvent itself in 1997 when it went for manufacturing three-wheelers. But an attempt at forging a JV later found no response. It is now a sick company with 83% machines older than 1970 and 43% workers aged above 55 years and set to retire in three years, sources said.

Lohias to introduce electric 3-wheelers

Lohia Auto Industries plans to launch electric three-wheelers by Septe­mber this year. The yet to be named model will be launched in passenger and commercial variants. “The electric three-wheeler model will help in cheaper city travel. We have invested Rs 20 crore for a new assembly line for manufacturing three-wheelers at our factory in Uttarakhand,” Ayush Lohia, chief executive of the Uttrakhand-based electric two-wheeler maker, said.

The model will be developed with 95 per cent local content and will compete with light commercial vehicles like Tata’s Ace. He said light commercial vehicles are generally used for a range of 100 km a day in a city and their usage could be rendered cheaper with an electric model.

Lohia said the company has written to the ministry of new and renewable energy seeking subsidy or cash benefits. The ministry has already granted cash benefits of Rs 5,000-6,000 on sale of electric two-wheelers and up to Rs 100,000 on sale of electric four-wheelers in December last year till the end of FY 2011-12 as part of the 11th five-year plan.

NK Lohia-promoted Lohia Group with roots in textiles and engineering plastics business. The company sold 5,000 units of electric two-wheelers in 2010-11 and aims to sell 9,000-10,000 units in 2011-12, said Lohia. “We plan to have 50 dealers in place including south India by the end of this fiscal,” Lohia said. The company is also looking to export its two-electric scooters Fame and O-Star to the UK, the US and Italy later this financial year through local distributors.

Vespa is coming back to India

The name Vespa strikes a chord in the Indian market. The Italian two and three-wheeler manufacturer's successful collaboration with LML for geared scooters was quite the story. But the joint venture with LML broke up in 1999 and it wasn't until eight years later that Piaggio announced plans to re-enter our market with a spanking new facility in Baramati that Vespa resurfaced. India will be the third country in the world, after Italy and Vietnam, to manufacture these scooters. Considering the fact that the Indian two-wheeler market is seeing ever growing demand for automatic scooters, there's always room for another manufacturer to spread its wares.

Piaggio's first scooter for India will be the automatic LX 125, set to arrive in 2012. The Vespa LX 125 is a classic model, paying tribute to the original 1946 Vespa with its retro styling. It is a compact scooter, sporting well-rounded curves and a cute, round headlamp which is flanked by chrome rearview mirrors. The front apron sports a centre cowl, reminiscent of scooters from the past, apart from a chrome grille that houses the horn. The front apron is otherwise clean, smooth and incorporates a set of tall, rectangular indicators. An angular front mudguard guards the front suspension and five-spoke alloys.

The LX dash employs a rounded housing and retro font, with a speedometer, fuel gauge, low-fuel warning light, tell-tale lights and digital clock. Switchgear is thoroughly modern, and classy. Inside the apron sits a petite glovebox, capable of holding a few knick-knacks. There's a ridged footboard below. The seat seems wide, and should provide comfort for both, rider and the pillion. A large under-seat storage bay is present as well. Behind the seat lies a functional-looking grab handle, while the LX 125 rear is smartly contoured, again retro, but simple with an edgy stop lamp and turn indicators. An all-metal body should endure the LX 125 with robustness, as opposed to most Indian plastic-body scooters of today. However, fit and finish and quality on the scooters to leave Baramati remain a question mark for now.

The LX 125 for India will deploy a 124cc, four-stroke, fuel-injected, air-cooled single cylinder engine. 125cc is a favourite displacement for Vespas, the Italian manufacturer having often given its vehicles similar capacity engines over six decades. Peak power output is a decent 10.7bhp at 8250rpm, while maximum torque will be 0.97kgm at 6500rpm. Its automatic CVT transmission, coupled with decent power and torque, should help the LX 125 deliver ample performance and offer convenience in Indian traffic conditions.

The front suspension is a single-side, linked arm with hydraulic shock absorber and coil spring, the rear suspension comprises a hydraulic shocker, adjustable for preload. The LX 125 uses a purposeful 200mm front disc brake, with a conventional 110mm drum behind.

With the pricing yet to be announced, indications are that the LX 125 will be dearer that its competition, with premium positioning. It is yet to be seen if the Indian market will accept premium scooters, shell out that difference in money and make a lifestyle statement. Only time and a India road test will give the answer.

HMSI shows 2% increase in sales in March and jumps to 30% in 2010-11

Two-wheeler manufacturer Honda Motorcycle & Scooter India (HMSI) today reported 2.09 per cent jump in its total sales for March at 1,47,301 units compared to 1,44,288 units in the same month of the previous year.

For the entire 2010-11 fiscal, the company's total sales increased by 30.31 per cent to 16,56,727 units from 12,71,377 units in the previous fiscal, HMSI said in a statement.

During March, motorcycle sales inched marginally to 65,899 units as against 65,888 units in March 2010, it added.

The company reported an increase of 3.83 per cent in scooter sales to 81,402 units last month from 78,400 units a year ago during the same month.

During 2010-11, the company's motorcycles sales rose by 44.06 per cent to 7,48,895 units from 5,19,832 units in the previous fiscal.

Scooters sales in the last fiscal stood at 9,07,832 units as against 7,51,545 units in 2009-10, up 20.80 per cent.

Honda plans to unveil scooters with stronger engines

Honda Motorcycle and Scooter India (HMSI), the leader in the automatic scooter segment, is preparing to launch a bigger capacity scooter.

Honda, the maker of Activa, India's largest selling gearless scooter, will tap the customer base which seeks upgraded versions of the available 100-125cc engines.

Shinji Aoyama, President and CEO, HMSI, said, "We will introduce a bigger displacement scooter in the coming period. There is a need for a more powerful product in that segment".

The company currently sells the Activa (110cc), Aviator (110cc) and Dio (102cc) in the scooter segment and five motorcycles � Twister, Shine, Stunner, Unicorn and Dazzler. Scooters will contribute nearly 55 per cent to the company's sales this year, which is expected to stand at 1.65 million units.

Although power scooters are popular in some overseas developed markets, manufacturers have been conservative in introducing them in India due to their higher price tags. Pune-based Kinetic Motor Company, once the market leader in the scooter segment, had launched a 165cc engine power scooter, Italiano Blaze, for nearly Rs 50,000. The demand for the Blaze was high due to its superior performance, but Kinetic wasn�t able to provide the service and back-up parts. Kinetic eventually decided to wrap up its business and sold its assets to Mumbai-based conglomerate Mahindra & Mahindra for Rs 110 crore in 2008.

Although there was no clear indication on what the new scooter from HMSI will be, market experts believe it would have an engine of around 130-150cc. The move towards a bigger engine is also triggered by the buoyant demand seen for the Suzuki Access 125. While a small capacity scooter of around 100cc carries a price tag of Rs 41,000, a bigger engine scooter by HMSI will ideally be priced at Rs 50,000-55,000, say market analysts.

The India scooter market has seen scorching growth so far this financial year, with sales of 1.88 million units, an increase of 44 per cent in the domestic market. HMSI currently has a market share of 43 per cent in the scooter segment with annual sales of 813,000 units.

Honda two wheelers to launch more auto-gear scooters

Honda Motorcycles and Scooters India (HMSI), country's market leader in auto-gear scooters, announces their plans for the coming years declaring more auto-gear scooters on their way.

"We are the market leader in gearless scooters. With demand for gearless scooters to grow in the domestic market, we are upbeat on this segment. Going forward, HMSI sees 40% business from scooters and 60% from motorcycles," said HMSI's President and CEO, Mr. Shinji Aoyama.

With good sales figures of 16.5 lakh units in last fiscal, HMSI is aiming to touch 21 lakh sales mark this fiscal and claiming the number one spot in the next decade. "We are very happy for the support from the people (in India). We need the same support to be number one in the next decade in India,"  said Mr. Aoyama adding "Our products are more in demand in the domestic market. Currently, we have 2.6-lakh waiting customers and plan to increase the capacity to meet market demand".

HMSI is also to expand their plant in Tapukara, Rajasthan to an initial capacity of 6 lakh units which is soon to be doubled. The company has invested Rs. 1000 crore on this new plant.

In the motorcycles department, Honda is launching next month the 250-cc version of its veteran  CBR called the Honda CB250R which is to be priced at Rs. 1.50 lakh.