Honda vrooms past Hero in 13 mkts, total share soars 3% to 27%

Two-wheeler major Honda Motorcycle & Scooter (HMSI) has not only toppled its estranged partner Hero MotorCorp in as many as 11 states, including Maharashtra and two UTs, as of the June quarter but also increased its market share by 3% from the entrenched leader to 27% now.

HMSI's market share has gone to 27% this year so far from 24% a year before,while Hero's came down to 40 from 41.3%, according to the SIAM numbers. As of the June quarter, HMSI, which has been consistently contributing almost 50% of incremental volume since May on its volume ramp up, now is the number one two-wheeler brand in 11 states -- Maharashtra, Karnataka, Gujarat, Kerala, Punjab, Delhi, Himachal, Goa, Manipur, Nagaland, Arunachal and the two Union Territories -- Chandigarh and the Andaman and Nicobar Islands.

Yadvinder Singh Guleria, senior vice-president for sales and marketing at HMSI, said while the firm has a national market share of 27%, up from 24% in Q1 of last fiscal, it has over over 50% share in Chandigarh, Goa, and Manipur; over 40% in Maharashtra, Gujarat, Arunachal, the Andamans, over 30% in Punjab, Karnataka, Kerala, Himachal, Jammu & Kashmir, and Nagaland.

It gained 4% in market share in Uttar Pradesh, Maharashtra and Rajasthan; 3% in Haryana, Madhya Pradesh, Assam; 2% in Gujarat, Punjab, Jharkhand, and Odisha; and 1% in Bengal and Goa during the first quarter. Hero, however, still stays ahead in the faster growing states like UP, Bihar, Uttarakhand, Rajasthan and most of the northeastern states. TVS Motor leads the Tamil Nadu market, though. Guleria attributed this growth to increasing scooterisation as well as capacity addition, which has seen its scooter capacity jumping by 1.2 million since this February.

"We lead in 11 states and two UTs, which together account of one-third of all two-wheelers sold in the country today. In fact we have been growing 50% faster than industry this year, helping us increase our market share in 19 states and two UTs," Guleria said, adding HMSI's scooter market share now stands at 58%.

He said these markets together contribute 33% of all the national volume. But when asked whether dethroning Hero is a near-term reality, Guleria said in Mumbai on Tuesday that they "have no such target as in terms of both installed capacity as well as reach, we need to do a lot of catch-up with Mujnal firm." 

HMSI president and chief executive Keita Muramatsu said Honda grew 50% faster than the industry at 22% in the June quarter, thanks to the fact that its flagship brand Activa is the No. 1 two-wheeler in the country since May. On his expectation from the festive sales, Guleria said he expects this year's sales to be "much higher than last year's 2.16 lakh unit on the single day of Dhanteras," without quantifying it.

Guleria based his optimism to the near total over the counter availability of the Activas now, having been able to reduce the booking period from 5-6 weeks earlier in the year to 2-3 days now, thanks to 1.2 million unit the Gujarat plant.

This shows that the Japanese two-wheeler major, which earlier this year commissioned its largest scooters only plant in Gujarat with a 1.2 million capacity, is not only getting closer to Hero but has started to dethrone the Munjal family-owned company that lead the market for decades in some key states and Uts, which together contribute half of the market volume, which stood at 16 million last fiscal.

Honda was the first in sales among two-wheelers during 2014-15 in five states and two UTs, including Maharashtra and Delhi. According to a Macquarie Research report, these markets contribute 55% of the total 16 million units sales last year and HMSI's market share gain has been led by the structural uptrend in scooters. The share of scooters has increased to 28% in FY15 from 12% in FY07, the report said out of which 58% is with HMSI.