Honda could consider launching more powerful scooters after 2020

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India’s biggest manufacturer of gearless scooters Honda Motorcycle and Scooter India could be looking at bigger and more powerful scooters in the future as its next growth opportunity.

Speaking to Moneycontrol, a senior executive of the company said that while the priority right now is to make a smooth transition to Bharat Stage VI, the company will look at 150cc scooters after the implementation of the new emission standards in 2020-21.

"Product line-up efficiency point of view we have Activa 110 and Activa 125 and Dio, Grazia. Then there is Navi and Cliq where we have created something new. In the future 150cc scooter, for instance, we must consider as a next stage. Currently we must focus on BS-VI preparation that is a big challenge for us after that we can (look at bigger scooters)," said Minoru Kato, President and CEO, Honda Motorcycle and Scooter India.

India's scooter demand is majorly centered around small family-oriented gearless scooters that score high on comfort, utility and mileage value. These unisex scooters are typically priced in the range of Rs 50,000-65,000 (ex-showroom).

But since the launch of Aprilia SR 150 in September this year, Piaggio created a new segment in the scooter category. The Aprilia SR 150 is powered by a 155cc engine that is tuned for performance like faster acceleration and higher top speed.

Piaggio's other scooter brand Vespa also has models powered by a 150cc engine. Sales for scooters having engines between 125-150cc fell by 4.2 percent to 19,495 units as against 20,353 units during April-Sep.

Saturation

With scooters now making up 32 percent of the total two-wheeler market, scooter manufacturers and industry experts feel that the segment is nearly saturated and that there is little headroom for growth from hereon for conventional scooters.

"There was no market for bikes above 200cc roughly 5 years ago in India. But today it is one of the fastest growing segments in the two-wheeler category. Over the next few years scooters buyers will go through the same transition and the need for more powerful models will be felt," said an executive at one of Honda's rivals.

Honda has a share of 58 percent in the domestic scooter segment, as per data shared by the Society of Indian Automobile Manufacturers. It sold 2.18 million units during the April-September period this year, as against 2.09 million units sold in the same period last year.

Kato also said that there has been a surge in demand for 125cc scooters over the past several months, signaling a change in buying pattern. Companies such as Hero MotoCorp, Suzuki and TVS Motor have launched 125cc scooters. Honda too launched a new 125cc scooter named Grazia.

Demand for 125cc scooters is coming mostly from urban and semi-urban areas because of the need for faster acceleration in congested city driving conditions.

"Though the share of 125cc scooters is small the segment is growing at a fast pace," said the executive quoted above.