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Mumbai: Hero Honda Motors Ltd, India's largest motorbike maker, sees sales under further stress now that a series of festivals is over unless personal borrowing becomes cheaper, a senior company executive said.
Hero Honda saw a marginal rise in two-wheeler sales in November from a year ago to 289,426 units, but tight credit markets and high bank lending rates have dented purchases of bikes, most of which are bought with loans, in recent months.
Despite a difficult year, the company, in which Japan's Honda Motor Co holds a 26 per cent stake, hopes to stick to the production plans it outlined at the beginning of the year.
Its sales have still risen 13 per cent during the April-November period from a year ago.
"Up to the festival season there was demand due to bonus, increments and marriages. All these things enable purchases," senior vice-president for sales and marketing Anil Dua said late on Tuesday.
"But now, unless the liquidity improves, unless the interest rates come down, this industry will find itself under severe pressure and find it difficult to grow."
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