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Hero Motocorp’s dominance in entry-level bikes is facing threat from its former ally Honda. Hero Splendor, which has been the largest-selling brand in the entry-level segment for the past two decades, has been de-throned by Honda Activa - India’s largest-selling scooter.
The Honda Activa outsold Hero’s Splendor (100-cc model) twice in FY14 with a margin of nearly 15,000 units. Honda sold 177,928 Activa in March 2014 compared with 163,778 units of Hero Splendor, industry sources revealed. Activa had sped past Splendor in September 2013, too. The Splendor sales figures taken for comparison include only the 100-cc model and not the 125-cc version.
Hero has four models and a variant under the Splendor brand, while the Activa has just two models.
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According to experts, what has worked for automatic scooters like Honda Activa is the ease of handling as well as greater utility aspects, which helped them rapidly gain acceptance in both urban and rural markets. Last year, scooter growth was three times that of the entire two-wheeler segment with sales settling slightly above 3.60 million or 24 per cent of the two-wheeler segment.
One of the biggest factors working in scooter’s favour is its ability to cater to male as well as female riders. On the other hand, motorcycles have traditionally been popular among male riders. Notably, scooters have significantly broadened the women customer base.
Confirming the development, Yadvinder Singh Guleria, vice-president (sales and marketing) at Honda Motorcycle and Scooter India, said: “We are excited that Honda Activa has once again become the highest-selling two-wheeler of India. This clearly indicates that Activa is exponentially getting acceptance as the most preferred choice of two-wheelers for commuting. We are proud to share that Activa is now strongly making inroads in Tier-2 towns and beyond.”
Honda is preparing to launch the bigger sibling of Activa with a 125-cc engine in the coming weeks. The bookings have already begun. This model - while it will compete with other scooters in the category such as Access 125, Swish 125, and Mahindra Duro - will also take on Hero Super Splendor (a 125-cc bike).
The Splendor brand collectively generated volumes of about 190,000 units a month for Hero. Honda is confident that Activa 125 would generate better volumes than the Super Splendor.
While Splendor sales declined by five per cent in FY14, Activa grew by 39 per cent during the same year compared to 2012-13, industry sources said.
