Companies

‘Covid offers us an opportunity as more customers want to buy two-wheelers’

S Ronendra Singh New Delhi | Updated on July 16, 2020 Published on July 01, 2020

Yadvinder Singh Guleria, Director – Sales & Marketing, HMSI

With customers preferring personal mobility over public transport, the market is witnessing a surge in demand, says Honda Motors’ Guleria

The country’s largest scooter maker, Honda Motorcycle & Scooter India (HMSI), says the pandemic, in a way, has given it an opportunity as demand for personal mobility is growing. The sales momentum post-Unlock 1.0 is more than what it had expected and it will continue in the future, and the company is gradually re-opening its dealerships across the country. In an interview with BusinessLine, Yadvinder Singh Guleria, Director – Sales & Marketing, HMSI, shares details. Excerpts:

How is the overall two-wheeler market picking up post-lockdown?

With Unlock 1.0, over 95 per cent of our dealerships are open since first week of June. In terms of demand, customers are now even more prudent in their choices with increase in mobility needs, especially for personal requirements. Based on Honda’s internal survey findings, customers willing to buy a new two-wheeler within three months have increased to 85 per cent (from previous 80 per cent), while 55 per cent (previously 45 per cent) customers plan to buy within the next one month — using both offline and online channels. With a rise in customers’ preference for personal mobility (around 30 per cent) over public transport, the market is witnessing a demand surge.

Can we say that the market is recovering now? Are the numbers the same as the corresponding period of last year?

The numbers have improved by the day and we are happy to see the sales momentum being more than what we expected. However, it is too early to conclude anything. Around 50 per cent of new Honda two-wheeler customers are those who had enquired about the two-wheelers before the lockdown. We have to factor in this pent-up demand as well, while closely watching the sustainability of volumes.

We are yet to ascertain how much of this demand will hold momentum in the coming months since the spread and impact of Covid-19 is different across States and cities. The situation remains fluid, with States announcing extended lockdowns with localised restrictions. It is, therefore, difficult as the industry has practically lost the first quarter for this year. While this fiscal may see a double-digit de-growth for the industry, we expect the market to recover in the long term.

Will the company launch all the planned products this year or postpone some to the next?

In order to recover some of the lost time, all our teams are working hard, including our supply chain. Due to the lockdown, we had to realign each and every plan. However, no product launch has been cancelled. Models that were set for launch are being introduced in the market one after another . In fact, in June, HMSI was the only two-wheeler manufacturer to introduce as many as four BS-VI models — CD 110 Dream, Livo, new Grazia125 BSVI scooter and the 2020 Africa Twin Adventure Sports.

How is the demand from the rural markets? When do you see it picking up?

In terms of rural development, the government is setting up infrastructure and providing economic support, like support for crops and road construction, promoting motorisation in rural areas. Moreover, an increase in sale of tractors in May reflects the eagerness of rural population to resume farming and allied activities at the earliest. With more females working in the areas of health and education, acceptability of scooters in rural will deepen the penetration levels of two-wheelers in rural markets too. Overall, these signs do indicate improved consumption sentiment in rural areas.

Are all the plants operating in full strength? How many two-wheelers are being manufactured in a day?

At present, Honda’s all four plants, located in Karnataka, Gujarat, Haryana and Rajasthan, are operational. Covid-19 slowed down our plans, while our dealerships were sufficiently stocked up to handle the BS-VI transition. Production is being aligned with the market demand, local regulations and in accordance with the supply chain. Any decision on further ramping-up of production will be taken in accordance with sustainable market demand, in order to reduce inefficiencies in the supply chain and our ecosystem at large.

Do you see any opportunity from this pandemic?

Covid for us is an acronym for Connected Opportunities Virtually Introspected and Discovered. With the new normal emerging and a world of phygital taking over, 80 per cent of our dealerships have now adapted to new digital norms to serve the growing base of the contactless customer.

With active involvement of our network, we have swiftly upgraded our digital capabilities for contactless customer engagement. New digital marketing initiatives to engage with intenders, safe payment processes, home deliveries by several dealers at local level while empowering manpower through focused online training are being expanded to adhere to the new normal. Very soon, our customers will be able to book their Honda two-wheeler at the dealer of their choice through our website as well.

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Published on July 01, 2020
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