Honda topples Hero to become India’s biggest 2-wheeler maker

Japanese automaker Honda Motorcycle and Scooter India (HMSI) has pipped its erstwhile partner Hero MotoCorp to emerge as India’s biggest two-wheeler maker by volume.

Honda sold 3.33 lakh scooters and motorcycles in September, cornering 27.73% market share, according to data released by FADA. Retail sales of Hero MotoCorp declined 23% year-on-year to 2.71 lakh units last month, accounting for 22.54% market share.

The market share of Hero has contracted from 26.76% in September 2023 to 22.54% last month. While Honda has gained market share, its retail sales also dropped 4.5% in September. About 60% of Honda’s sales come from scooters and 40% come from motorcycles. For the industry, motorcycles account for two-thirds of total two-wheeler sales.

Industry sales of two-wheelers fell 8.5% year-on-year due to low consumer sentiment, poor inquiries, and reduced walk-ins, according to FADA. Seasonal factors like the 'Shraddh' period and heavy rains further impacted demand, resulting in delayed purchases and a subdued market environment, the auto dealers’ lobby says.

TVS Motor Company, India’s third largest two-wheeler maker by volume, sold 2.21 lakh units in September, down 3.5% from 2.29 lakh units in the corresponding month last year. TVS’ market share rose to 18.37%.

Bajaj Auto sold 1.41 lakh units in the domestic market last month, cornering 11.7% market share.

Honda Motorcycle and Scooter India, the maker of Activa scooter, is planning to introduce its first electric two-wheeler in the country this financial year, Yogesh Mathur, HMSI’s director of sales and marketing, told Fortune India in an interview.

“We will soon be coming in EVs. We are the only OEM which is left out currently,” Mathur said. “Till last year it (EV sale) was clocking around 5% and now it has reached 8%. The contribution of EVs is increasing. By 2030, there will be a major chunk shifting towards EVs. We also have announced that by 2030, one-third of our sales will be from EVs,” Mathur explained.

This comes at a time when two-wheeler sales are yet to recover to their pre-pandemic highs. “With 10-12% growth, by next 3-4 years, two-wheeler sales should come back to the pre-pandemic levels,” Mathur said, adding that the industry will close the current fiscal with over 1.7 crore units.

Honda’s scooter sales grew 24% in 2023-24, higher than motorcycle sales which rose 13%. On average, two-wheeler sales grew 16% last fiscal. Urban growth was faster than rural growth.

“Currently entry motorcycle segment 100-110cc is growing by around 2%. The major growth is coming from the 125cc segment which is growing at 55%,” he said, adding that entry consumers are shifting towards 125cc motorcycles. HMSI’s current capacity is 62 lakh units annually. The automaker currently has nine motorcycles and four scooter models in its portfolio.