About Hero Honda Motors Limited

Hero Honda Motors Limited, based in Delhi, India is a joint venture between the Hero Group of India and Honda of Japan. It has been referred to as the world's biggest manufacturer of 2-wheeled motorized vehicles since 2001, when it produced 1.3 million motorbikes in a single year. During the fiscal year 2008-09, the company has sold 3.28 million bikes and the net profit of the company stood at Rs.1281.7 crore, up 32% from the previous fiscal year.

The company's most popular model is the Hero Honda's Splendor, which is the world's largest-selling motorcycle, selling more than one million units per year.

Company profile

“Hero” is the brand name used by the Munjal brothers for their flagship company Hero Cycles Ltd. A joint venture between the Hero Group and Honda Motor Company was established in 1984 as the Hero Honda company.

During the 1980s, the company introduced motorcycles that were popular in India for their fuel economy and low cost. A popular advertising campaign based on the slogan 'Fill it - Shut it - Forget it' that emphasised the motorcycle's fuel efficiency helped the company grow at a double-digit pace since inception.

Hero Honda has three manufacturing facilities based at Dharuhera and Gurgaon in Haryana and at Haridwar in Uttarakhand. These plants together are capable of churning out 3.9 million bikes per year. Hero Honda's has a large sales and service network with over 3,000 dealerships and service points across India. Hero Honda's customer loyalty program, the Hero Honda Passport Program, claims to be one of the largest programs of its kind in the world with over 3 million members.

The 2006 Forbes 200 Most Respected companies list has Hero Honda Motors ranked at 108.

History

India became the second largest two wheeler manufacturer in the world starting in the 1950s with the Automobile Products of India (API) that manufactured the Lambrettas and Bajaj Auto Ltd. with its association with Piaggio of Italy (manufacturer of Vespa scooters) as the largest manufacturers within the country.

The license raj that existed between the 1940s to 1980s in India did not allow foreign companies to enter the market and imports were tightly controlled. This regulatory maze, before the economic liberalization, made business easier for local players to have a seller’s market. Customers in India were forced to wait up to 12 years to buy a scooter from Bajaj. The CEO of Bajaj commented that he did not need a marketing department, only a dispatch department. By the year 1990, Bajaj had a waiting list that was twenty-six times its annual output for scooters.^]

The motorcycle segment had the same long wait times with three manufacturers: Royal Enfield, Ideal Jawa, and Escorts. Royal Enfield made a 350cc Bullet with the only four-stroke engine at that time and took the higher end of the market but there was little competition for their customers. Ideal Jawa and Escorts took the middle and lower end of the market respectively.

In the mid-1980s, the Indian government regulations changed and permitted foreign companies to enter the Indian market through minority joint ventures. The two-wheeler market changed with four Indo-Japanese joint ventures: Hero Honda, TVS Suzuki, Bajaj Kawasaki and Kinetic Motor Company (Kinetic Honda). The entry of these foreign companies changed the Indian market dynamics from the supply side to the demand side. With a larger selection of two-wheelers on the Indian market, consumers started to gain influence over the products they bought and raised higher customer expectations. The industry produced more models, styling options, prices, and different fuel efficiencies. The foreign companies new technologies helped make the products more reliable and with better quality. Indian companies had to change to keep up with their global counterparts

Diversification

The Group Chairman, Mr. Lall has actively looked at diversification. A considerable level of vertical integration in its manufacturing activities has been present in the Group's growth and led to the establishment of the Hero Cycles Cold Rolling Division, Munjal and Sunbeam Castings, Munjal Auto Components and Munjal Showa Limited amongst other component-manufacturing units.

Expansion into the automotive segment started with the setting up of Majestic Auto Limited, where the first moped designed entirely in India, Hero Majestic, went into commercial production in 1978. Hero Motors, in collaboration with Steyr Daimler Puch of Austria introduced the which introduced another moped, the Hero Puch, in 1980. Hero Honda Motors was established in 1984 to manufacture 100 cc motorcycles.

The Hero Group also plans to expand into into other segments like exports, financial services, information technology, insurance and telecommunication.

List of models

• Achiever
• Ambition 133, Ambition 135
• CBZ, CBZ Star, CBZ Xtreme
• CD 100, CD 100 SS, CD Dawn, CD Deluxe, CD Deluxe (Self Start)
• Glamour, Glamour F.I
• Hunk
• Joy
• Karizma, Karizma R, Karizma ZMR FI
• Passion, Passion+, Passion Pro
• Pleasure
• Street
• Splendor, Splendor+, Splendor+ (Limited Edition), Super Splendor, Splendor NXG