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As Japan’s bike quartet comes together for electric ride, India could see some mobility dynamics

Murali Gopalan | Updated on May 09, 2019 Published on May 09, 2019

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Honda, Yamaha, Suzuki and Kawasaki are now part of a consortium for battery technology

Japan’s Big 4 comprising Honda, Yamaha, Kawasaki and Suzuki have come together to be part of an electric motorcycle battery consortium. The idea is to develop standardised battery technology as well as charging infrastructure.

The news appeared in the Japanese media some weeks ago, which was confirmed by two of the participating companies. On the face of it, this will basically involve some of the best brains in the motorcycle business sitting together and coming up with a solution.

Pooling competencies

However, there is definitely more to this than meets the eye. The fact that four local companies in Japan will pool in their competencies is not a trivial development. It also follows closely on the heels of the Honda-Yamaha announcement for joint development of sub-50cc scooters in Japan.

At that point in time, the two companies made light of the announcement insisting that this was for a niche product segment that was quite marginal in Japan. Since there was no point replicating investments, it made sense for the duo to share costs.

The reasoning was perfectly sound except that Honda and Yamaha have been foes for years in what was termed the H-Y wars of the 1980s. The fact that they have chosen to bury the hatchet, albeit in a small business area of scooters, is still remarkable.

To experts tracking the Japanese auto industry, this kind of consolidation is already happening with local brands as in the case of Toyota-Suzuki, Nissan-Mitsubishi and Toyota-Mazda. The Honda-Yamaha bonding is also part of this ecosystem and, perhaps, even the more recent move on e-mobility by the four top bike-makers.

By the end of the day, pragmatism is the way forward especially in a new area like electric, which could just end up dominating the automotive landscape in the coming years. There are real challenges to deal with here in terms of battery costs, charging infrastructure, battery swaps, range and so on.

This big unknown is equally challenging for car-makers too, which explains why a whole lot of them are coming together from different parts of the world to pool competencies and investments. In the case of bikes, the fact that Japan’s biggest brands have chosen to converge cerebrally clearly signals that the directive may have come from top circles within the Government.

It now remains to be seen how work progresses within this consortium and what kind of new solutions emerge. Will a similar collaboration template be contemplated in India too, which is the largest two-wheeler market in the world? All the four Japanese brands are present here, with Honda comfortably ahead of the rest even while Yamaha and Suzuki are stepping on the gas.

India has articulated its intent in e-mobility for a while now even if the goalpost has been changing in terms of the coverage intended. What was targeted as 100 per cent electric by 2030 has now come down to 40 per cent or even lower. Yet, there is a desire to embrace the concept of e-mobility in a big way for public transport as well as two-wheelers.

Implications for India

There are, of course, a host of challenges ahead, especially in the area of fiscal sops and infrastructure. This is where the move by Honda, Yamaha, Suzuki and Kawasaki to come together in Japan may just end up having some interesting implications for India though these are early days yet.

Considering that nothing has really kicked off in Japan yet, it would be naive to assume that there will be changes galore in markets like India. Still, the fact that these companies have indicated an intent to examine an issue jointly simply means that it is better than tackling it in silos.

Many years ago, Suzuki and Kawasaki had decided to team up for joint sourcing of parts largely to keep their cost structures in check. Not much came from this joint effort though it was an acknowledgement of a need for practical solutions. The same could well be seen in the electric arena where exchanging skills, and yet remaining competitors, could be a practical way forward.

In India, Yamaha has announced its intent in the e-bicycle space with Hero Cycles some months ago. From the company’s point of view, it makes sense to look at all mobility options especially for emerging markets, which are grappling with the challenges of urbanisation. And for Yamaha, which is keen on growing its market share here in two-wheelers, getting a brand association with e-bicycles is still worth its while.

As for Suzuki, it seemed almost somnambulistic since the time it split with the TVS group nearly two decades ago. It is only in recent years that the company has been pulling out all the stops in its two-wheeler business with the emphasis being on premium bikes and scooters. The renewed focus is working well and Suzuki is on target to producing a million units by the end of this fiscal. It will also be ready to move to its second plant, which could well be the laboratory for e-mobility.

Kawasaki going solo

Kawasaki is still a small player in comparison to its other three Japanese counterparts. For many years, it had an alliance with Bajaj Auto in India but has now chosen to go solo. Its strength lies in high performance bikes and it will be interesting to see how the electric consortium in Japan will have its fallout for its India innings.

Honda is, of course, the monarch of the four and is trying to replicate this in the overall two-wheeler arena in India where its erstwhile ally, Hero, continues to lead the pack.

It is hopeful that the move to Bharat Stage VI emission norms in April 2020 will establish it as a force to reckon with in fuel injection technology at an affordable price. While the electric frontier is still unknown, a big brand like Honda could meet the challenge.

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Published on May 09, 2019
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