After Bajaj, Royal Enfield will face tough competition from Honda Motors as it is working on a middle weight motorcycle to take on the classic brand. According to media reports, Honda Motor has formed a team of engineers from its home land and Thailand that will be working in India to develop a middle weight motorcycle. The motorcycle will compete with Royal Enfield and the announcement doesn't come as a surprise as Royal Enfield dominates a segment that offers high-profitability.
Noriaki Abe, President and Chief Executive Officer (CEO) at Asian Honda Motor Co. said “We (have) already allocated the people, some from Thailand and some from Japan to India to make a new concept mid-sized motorcycle in India.”
Will it be possible for Honda to beat Royal Enfield?
While Honda has thrown the challenge in the open now and there could be more companies that could join in soon, Royal Enfield wouldn't be worried right now. The company is the largest player in its segment and has more than 95 percent share in the 350cc + segment. In the 350cc segment, Royal Enfield sells the Classic 350, Electra 350 and Thunderbird 350 presently.
On the other hand, Bajaj Auto launched Dominar 400 and entered in the sub-500cc segment, motorcycle segment. With Dominar 400, Bajaj Auto has taken a bite off Royal Enfield's customers and many riders are taking interest in the Dominar 400. As we told you earlier, Bajaj Auto has taken over the 20 percent share from Royal Enfield, which is quite a lot for a new motorcycle. In expansion of its market share, Bajaj Auto is also planning to launch a new motorcycle in sub-500cc segment, it is expected that the motorcycle will be a fully faired version of Dominar 400.
However, it will be interesting to see how, Honda will take on Royal Enfield in the mid size segment. While Honda enjoys a brand reputation of being a premium and reliable brand, it doesn't strike the emotional chords among Indian buyers as Royal Enfield does. Not only is Royal Enfield a cult brand in India, it also engages with its customers through regular rides and tours more than any other two-wheeler maker in India.
Beating such a brand will require a special motorcycle from Honda and knowing Honda, the motorcycle could easily be about two years away from the first production mule. Look at Honda's roadmap in India,t he company has usually been slow to release products. That's not because they can't, it's simply because they have such an attention to detail in Japan for every little thing that the entire process gets lengthened.
In the mean time, Royal Enfield will launch its 750 cc motorcycle, which will open up a whole new segment and customer base for the company. The company has been quite vocal about increasing its market share in international market, especially in the 500 – 750 cc segment. With that in mind, Royal Enfield could be ready with more new motorcycles and newer technologies, making things more difficult for the competition.
Building a motorcycle that's technically better than Royal Enfield is a child's play for Honda with the ocean of technology it owns. Creating a motorcycle with the same emotional appeal though is going to be an uphill task, even for Honda.