Wednesday, December 1, 2010

Honda keeps mum on the issue of Hero group

Japanese auto giant Honda which has a successful partnership with Hero group to script growth chart with Hero Honda in Indian market is now reportedly keeping mum on the rumored split in the Joint Venture. Honda holds 26 percent in the Hero Honda but Honda has now an independent two-wheeler arm in India competing directly with Hero Honda products.

According to agency reports, Honda had stated that meeting two-wheeler demand in India is the biggest challenge for the company. The report quoted Honda Motor Co President and CEO Takanobu Ito as saying "Two wheeler market in India is growing at a scorching pace of more than 30 per cent. Therefore, if the market keeps growing at this pace, I believe, the bigger worry is, for any company, no matter how quickly they expand, it will be difficult to keep pace with the growth of the market.’’

Ito answering a question on the future of their JV in India deflected the issue saying "It (meeting the demand) should be a greater worry than anything else. So other than that, I don't think there is any need to worry about any other issue regarding two-wheelers in India.’’ It was reported that he, however, declined to give any comment on reported differences and a possible split with its partner Hero Group.

It was reported that total two-wheeler sales in India achieved a record figure of 11,27,827 units in October, up 50.38 per cent from the same month last year. Similarly, motorcycle sales of 8,76,810 units in the month, up 43.31 per cent, was also a record.

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