The country’s single largest two-wheeler manufacturer Hero MotoCorp, which parted ways with Japanese auto major Honda Motor Corporation (HMC) early last year, will introduce its first independently developed product in the Indian market in the next financial year.
Over the next two years, the company which has inked three technological alliances globally will introduce its own range of two-wheelers in the country.
Anil Dua, senior vice-president (marketing and sales), Hero MotoCorp said, “We have rights to use the new products we are sourcing from Honda till 2017. While we will continue to modify and improve the existing products in our portfolio, we are also working on our own range of products with the help of our technology partners. The first such product with our own IPR will hit roads next fiscal.”According to the licensing agreement signed with HMC, Hero MotoCorp will replace the new products (such as Maestro, Ignitor and Impulse) it sources between now and 2014 with its independently developed model.
Dua declined to share specifics of the segments the company is looking at entering with their own technology over the next two years, but on the cards in is hybrid scooter Leap. The product being developed in association with EBR was showcased by Hero MotoCorp at the auto show in Delhi in January. Besides, a range of motorcycles across segment will be launched by 2016.
While Hero’s local research and development team has been mandated to evaluate consumer requirements in the domestic market, technical tie-ups have been forged with firms worldwide - Italian design firm Engines Engineering, US-based performance bike manufacturer Erik Buell Racing (EBR) and Austrian engine developer AVL - for sourcing expertise in specific areas.
“Our ultimate aim is to have our partners as an extended R&D arm for Hero MotoCorp. These partners have huge specifications available and we want to be known as a full-fledged global two-wheeler brand eventually," Pawan Munjal, chief executive officer and managing director, Hero MotoCorp, had said recently. The company is separately investing Rs 400 crore to set up a R&D centre near Jaipur in Rajasthan.
The measures are significant as prior to the termination of the joint-venture Honda used to supply technology for products which Hero marketed in India. The Hero Group and Honda had agreed to end their 26-year-old joint venture Hero Honda, with the Indian partner agreeing to buy out Honda's 26 per cent stake in the company for Rs 3,841.83 crore in December 2010.
Dua further informed that the company, which has been facing pressure on sales in the domestic market, expected sentiments to revive with the festive season. “Sales in the two-wheeler industry declined by five per cent last quarter. The reforms announced recently have improved market sentiments.
The festive season will help in precipitating purchase decisions. We expect to bounce back and sell around 500,000 units this month.” Volumes at Hero MotoCorp dropped for the third straight month in September. Sales for the company had plummeted by 26 per cent to 393,852 units last month.
