Today’s generation knows how much the two-wheeler market has changed in the last 25 years. But who benefited and who lost out? Which is your first bike, Hero or Honda?
Hero’s Journey
First, let’s talk about Hero. The demand for bikes was rising, but who would make them? The Indian Hero Group, led by the Munjal family, decided to step up. They didn’t know how to make bikes, so they partnered with a Japanese company known for fuel-efficient and affordable bikes. Their slogan was “Fill it, Shut it, Forget it” – fill petrol once, and the bike would keep running.
By 2001, Hero had become the biggest bike manufacturer in India. However, despite a great partnership, things started to go sour. Hero wanted to export globally, but Honda had restrictions. Also Honda already had a subsidiary in India, HMSI, selling scooters like Activa. By 2010, the partnership ended.
The Current Market of Hero Motors
Who leads the market now? Unsurprisingly, it’s still Hero MotoCorp, thanks to their early mover advantage. For 30 years, they have been market leaders.
Let’s understand the market share from 2008-09. Before that, Hero’s market share was 49%. By September 2022, Hero continued to lead due to their low-cost and high-efficiency bikes, especially in the entry segment of 100-110cc bikes.
Hero’s star product, the Splendor, remains India’s best-selling motorcycle. But the market dynamics have shifted. In 2012-13, 65% of bikes sold were entry-level, but now it’s down to 46%. The mid-segment bikes (110-125cc) have grown to 30%.
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Challenges and Future of Hero Motors
Hero’s share in entry-level bikes has dropped from 70% to 19%. The market is evolving with social media influence and better EMI options. People prefer higher-end bikes, moving from 100-110cc to 125cc.
In 2012-13, 65% of bikes sold were entry-level, but now it’s just 46%. The 125cc segment is growing, and Hero has less presence here. Annual growth in the 100-110cc range is only 2%, while the 125cc and above segment is growing faster.
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So, the battle continues. Who will be the king of the 125cc market? Hero, Honda, or someone new? Let me know in the comments. We’ll be back with another case study soon.
I hope this makes it easier to understand! 🚀