Achieving a new milestone, Honda Motorcycle and Scooter India (HMSI) sold higher number of motorcycles than its mainstay scooters during Diwali on the back of strategic push it gave to its product. The company, which sells more number of scooters, saw the opposite during the festival season when motorcycle sales comprised 53% of its total sales on the back of its strategic initiative.
Since motorcycle sales have been lacklustre during the current fiscal due to weak demand in the rural economy, HMSI collaborated with 10 financial institutions – banks and NBFC’s – to provide lucrative and affordable schemes to customers.
In order to capture volumes from rural market during the festival period, HMSI started advertising through radio and launched new vehicles like Livo just before the festival season. The company also refreshed it entire range of scooters. Motorcycles are generally preferred in rural parts to scooters due the rough terrain. Scooters are seen as an urban transport.
Speaking to FE, HMSI vice-president (sales and marketing) Yadvinder Singh Guleria said: “This year new launches like Livo were made well before the festive season. We ensured supply of right product mix at every showroom and promoted our products and finance schemes on FM radio for the first time.”
According to the company, HMSI sold 20,000 units of Livo, the latest offering in the executive motorcycle segment, while volumes of CB Shine, another bike, crossed more than a lakh during the festival period. Overall, its motorcycle sales during the Diwali season increased 20% y-o-y compared to the festival season a year back.
In the last three months, HMSI also had tie-ups with banks and several financial institutions. In order to woo customers, HMSI provided schemes wherein a customer would have to pay only R5,999 to own a motorcycle, with no additional processing charges. Through the collaboration with financial institutions, we managed to provided affordable schemes which reduced the cost of ownership. According to our estimates, almost 40% of the total sales happened through finance. Normally, it stands around 35%,” said Guleria.
Volumes from the rural sector contributes around 25% to HMSI’s total sales, but this time during the festival period contribution of rural sales increased to more than 30%.
HMSI has 850 main dealers across the country and the total network has also crossed 4,500 which includes the sub-dealers and the authorised service centres.
Usually the western and southern states contribute about 58-59% of the total volumes of HMSI. During the current festive period, the Japanese two-wheeler manufacturer received more that 50% of the volumes from states like Maharashtra, Gujarat, Goa, UP, Chattishgarh and Madhya Pradesh.