Hero Motocorp hopes to regain the ground lost to the likes of Honda, KTM and Bajaj by focussing on premium motorcycles segment.
The year 2017 ended with Hero MotoCorp launching three commuter-friendly bikes under it's most popular brands Splendor and Passion. The year also marked the end of Hero's singular focus on the bread-and-butter economy bike (100-110cc) segment.
With the launch of the Hero Xtreme 200R on Tuesday, Hero ambitiously announced that for the next 18-20 months it will focus on the premium bikes (150cc and above) — a segment from which it hopes to connect with the youth who are increasingly drifting towards foreign brands like KTM, Benelli, Kawasaki, Aprilia and Honda.
"The first step was renewal of our entire core commuter brand and that ended in December. The year 2018 will be about being in the segment where we are not present. Today, we take the first step towards that with the Extreme 200R targeting the consumer group of below Rs 1 lakh. There is much more to come , it is all a matter of priority. For the next 18-24 months, the focus will be growth in the premium motorcycle segment and scooters," Malo Le Masson, Head Global Product Planning, Hero Motocorp told Moneycontrol.
Currently, Hero has a minuscule share in the premium segment where is trails Bajaj Auto and Honda. It is, however, the market leader in the highly fuel-efficient economy bike segment with more than 80 percent share.
"Despite the first to launch a 150cc in the form of the CBZ way back in 1999 — full two years before the Bajaj Pulsar — we have not been able to develop that segment. We are now readying a portfolio that will allow us to target a bigger a share of the premium segment," said a senior executive from Hero Motocorp.
To build such a strong portfolio, the company is boosting its 600-engineers strong research and development team. It also has the Neemrana facility in Rajasthan which is capable of building bikes having engines up to 1000cc. It also has a technological tie up with Austrian company AVL engines.
Hero Motocorp has also admitted that it has been slow to capture the scooters market adequately and feels it is under represented in that segment. "We will have more products in the scooters segment going forward," said another senior executive.Honda is presently the market leader scooters with the Activa which commands more than 50 percent volume share in the market. TVS Motor Company is the second biggest scooter maker with its best-selling model Jupiter.