The Hindu Business Line : Tight financing impacting 2-wheeler sales: Honda CEO

Mumbai, April 21 More than high interest rates, stringent conditions laid down by financiers are hitting the two-wheeler industry, said Mr Shinji Aoyama, CEO and President, Honda Motorcycle & Scooter India (HMSI).

“However, for HMSI, our problem is relatively smaller than others,” he added at a function here to launch the new Activa gearless scooter.

HMSI has tie-ups with SBI, HDFC, Shriram Transport Finance and regional cooperative banks to finance customers for its product range.

“Since January 2007, we have been seeing a drastic withdrawal of financing by banks. However, this has been offset by customer demand for two-wheelers,” said Mr N.K. Rattan, Operation Head, Sales & Marketing, HMSI.

He said that nearly 80 per cent of HMSI buyers paid by cash with the rest opting for financing.

HMSI sold 1.07 million two-wheelers last fiscal against 9.07 lakh units in 2007-08, an increase of 18 per cent.

Scooters accounted for 6.6 lakh units with lakh motorcycles taking up the balance. The company has targeted 1.25 million this year, of which scooters will comprise 7.4 lakh and motorcycles 5.1 lakh units.

The new 110cc Activa offers 15 per cent more mileage at 50-55 km/litre, which is almost on a par with motorcycles. It sports an on-road (Mumbai) price of Rs 47,152.

More Stories on : Two/Three Wheelers | Consumer Finance

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