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Hero Honda sales zoom 12% in Feb(Indian Express Via Thomson Dialog NewsEdge) In a reversal of fortunes of sorts, two-wheeler market leader Hero Honda, spurred by the success of the refurbished 150cc bike CBZ Extreme, has zoomed ahead of competition, reining in the hectic pace of growth of archrival Bajaj Auto. The market leader posted growth higher than the industry in the first two months this year. Posting sales of 280,515 bikes in February, the company saw a 12 per cent growth even as the industry grew 5 per cent. Importantly, Bajaj Auto, which was eating into Honda's market share not long ago saw a slump in February as sales dropped by 2 per cent to 171,780 units. Just over six months ago the scenario was starkly different. With the market shifting to the executive segment and the Pulsar and Discover twins ruling the roost, Hero Honda was on slippery ground steadily losing market share as the gap between the two nose-dived to just 37,000 units in September. The festive season, however, witnessed the beginning of a turnaround that continues till this day. With Bajaj struggling with capacity constraints, Hero Honda opened up the gap to over 100,000 units. With CBZ entering the market in October, the market leader has managed to maintain the gap while surging ahead of the competition. "The overall market has not changed much between September and January but what we are seeing today is Hero Honda getting aggressive in the 150cc segment. While Bajaj has lost some ground there, Hero Honda has made inroads while retaining its lead in the voluminous 100-125cc segments," said an industry analyst. SIAM figures for Sept-January show that in the 125-250cc segment considered to be Bajaj's forte, the sales have come down from 83,728 to 72,947 units while Hero Honda has grown from 4,759 to 17,072 units. This growth mirrors CBZ's number, which have gone up from 6,500 in November to around 16,000 in February. While cutting down the deficit in 150cc segment, Hero Honda has held its own in the entry level segment while Bajaj has lost a lot of ground there (See table). "We have gained market share in each of the last three months and CBZ has played a part in that. It has lifted our portfolio and we are now facing supply constraints on the model which has the potential to clock 20,000 units every month. We have done well in the entry level segment as well courtesy the new Glamour," said Anil Dua, vice-president, marketing and sales, Hero Honda. While the official press-statement of Bajaj says that the performance in February was hampered due to supply constraints, an official admitted that it was competition more than supply that led to the decline. "Hero Honda's product mix is no longer what it used to be a year ago and they appear to be much stronger now. After that low in the middle of last year they have made a strong comeback," the official said. Bajaj is already gambling with a totally new game plan of exiting the entry-level segment and elevating further up. With Hero Honda still strong in that segment, Bajaj wants to make its own rules as the battle for the top slot intensifies. Copyright 2007 The Indian Express Online Media Ltd.. Source: Financial Times Information Limited. |