Hero MotoCorp has a come a long way since parting ways with Honda. The company has done a lot to transform itself – not only in terms of hiring global talents – but also to set up a state-of-the-art research and development centre in Jaipur.

Over the last three years, the company has entered 35 markets globally, the latest being Argentina. BusinessLine caught up with Pawan Munjal, Chairman, Managing Director and CEO, Hero MotoCorp, in Buenos Aires. Excerpts:

How important is the Argentine market? How much does the Latin American market contribute to your overall exports?

Argentina is among the top three two-wheeler markets in South America. With the commencement of operations in Argentina, we are now present in 35 countries and working towards having operations in 50 countries by 2020.

It is an important market for us, a fact borne out by our first overseas manufacturing facility in Colombia. The importance of the Argentine market is reflected through our decision to choose Buenos Aires as the location for our first global product launch outside of India.

When do you plan to start manufacturing in Argentina? Which will be your next market after Argentina?

We don’t have any immediate plans to manufacture here, but we can always exercise that option depending on the market demand and improvement in the local economy. We already have a manufacturing plant at Villa Rica in Colombia and going forward, we plan to cater to the Andean countries from that plant. We will be shortly opening up the Bangladesh factory as well.

As a two-wheeler market leader you are a late entrant in other countries. Do you see the competition (Bajaj Auto and TVS Motor)?

It is right that we are a late entrant. Our compatriots from India are ahead of us in these markets and are doing really good in volumes. That gives me a confidence that there is a huge market.

Why is it taking long to enter Brazil?

There are multiple socio-economic factors that need to be considered before we start operations in any new market. The current global economic scenario and the status of the Brazilian economy are not conducive. Brazil is different and requires certain technical and engineering changes to be made to products.

Do you think the African and Latin American markets are low hanging fruits for your exports?

These markets present good business opportunities for us, given their similarity to our domestic market in terms of customer preferences and product specifications. However, each market presents a unique challenge. Other markets like the US, Europe or South-East Asia also present their own unique challenges.

What are the products you want to tap export markets with?

Some products are designed and developed keeping the global customer in mind, some products are focused on certain markets. For example, the ‘New Glamour’ has been designed keeping in mind young customers. It has a sportier design, perfect amalgamation of power and performance and it is fuel efficient. On the other hand, the Dawn 125, which we showcased at the EICMA this year, is designed specifically for the African market.

For the domestic market, what are the products you are working on? What is your take on electric vehicles?

Since the last Auto Expo we have launched three new products across different segments. We are working on further bolstering our premium product portfolio with bikes such as the Xtreme 200S. We displayed our intent at the Auto Expo when we showcased a host of new products, including an electric scooter. Our electric vehicle plan is also in progress

Do you think there is a lack of government support on such products?

I think the Centre is cognizant of the need for alternate fuels and is working on schemes for such products. There are schemes like Faster Adoption and Manufacturing of Hybrid and Electric vehicles in India and industry bodies like Society of Indian Automobile Manufactures (SIAM) has also asked for the extension of it.

Since electric vehicles market is not picking up, would you think of hybrid two-wheelers, just like few car companies are doing?

A lot depends on the availability of technologies and the growth and development of allied and supplementary industries, like battery durability, life, and cost. Battery costs are currently too high to be viable for electric vehicles. The Centre of Innovation and Technology at Jaipur is focused on developing global products with latest technologies, keeping in mind environmental regulations as well.

It’s taken many years for electric cars to really come up to certain commercial volumes, but it has happened. We need to be ready for that change.

The writer was in Buenos Aires on the invitation of Hero MotoCorp

Recently in Buenos Aires Argentina

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