Hero MotoCorp to more than double output of Splendor to win back top slot

Written by Roudra Bhattacharya | New Delhi | Updated: May 23 2014, 06:41am hrs
HeroHero's two-wheeler volumes were up over 14% at 5.58 lakh units in April, when the overall segment grew almost 12%.
Hero MotoCorp is more than doubling production of some variants of the top-selling Splendor range of motorcycles to meet high domestic and export demand. The move is expected to help the two-wheeler market leader regain the crown of the top-selling model in the domestic market, which the Splendor lost to erstwhile partner Hondas Activa scooter a few months ago.

Just over two months after its launch, Hero plans to increase the daily output of the successful Splendor iSmart model to 1,200 units a day (almost 30,000 units a month) over the next few months from less than 800 units a day, industry sources told FE. The iSmart is the only bike in India to offer the i3S technology a fuel saving start-stop system, similar to those found in premium cars, that turns off the engine when the vehicle has stopped for brief while, such as at a traffic signal.

Anil Dua, senior VP (Marketing & Sales) at Hero MotoCorp, confirmed, We have received a phenomenal response from customers in a very short span of time since the launch of the bike. We are, therefore, doubling the production of Splendor iSmart to 20,000 units from the current level of 10,000 units per month. Going by the trend, this is likely to go up still further as in coming months.

Other brands in the Splendor range the 100cc Splendor Pro, Splendor NXG and Splendor+ and the 125cc Super Splendor will also see a boost in monthly output, especially from June, when Hero's fourth plant at Neemrana (Rajasthan) starts commercial production with an initial annual capacity of 7.5 lakh units. Hero's three other plants are in Gurgaon, Dharuhera and Haridwar.

Hero's 100cc Splendor range has been the country's top-selling two-wheeler brand for many years, but, very recently, it was ousted from the top spot by Honda's 110cc Activa scooter for a few months. Although for full FY14 Hero's Splendor was ahead, in March 2014 the Activa outsold the Splendor with a margin of nearly 15,000 units Honda sold 1.78 lakh Activas in the month compared to 1.64 lakh Splendor bikes. Strong demand and capacity expansion are therefore expected to help the Splendor regain its top position.

There is also strong demand for the Splendor from export markets, for which production is going up further, another source close to the development added.

Even as most carmakers and some two-wheeler makers, such as Bajaj Auto, struggle to show volume growth, Hero MotoCorp is in the select category of few manufacturers, such as Honda, thats witnessing strong demand. Hero's two-wheeler volumes were up over 14% at 5.58 lakh units in April, when the overall segment grew almost 12% to 13 lakh units and Honda saw a 21% jump to 3.01 lakh units. Bajaj Auto, on the other hand, saw volumes dip 16.5% to 1.67 lakh units. In FY14, Hero's volumes were up 3.4% at 61 lakh units while the two-wheeler market was up 7% at 148 lakh units.

Hero, which till the end of calendar year 2013 was grappling with high inventories (6-7 months), is now in a much more comfortable position, analysts and dealers said.