Honda moves past Bajaj Auto in July 2013 two wheeler sales

Honda Motorcycles and Scooters India is on a roll what with the Japanese two wheeler major registering big gains in monthly numbers. Honda has moved ahead of Bajaj Auto to emerge as the second largest two wheeler maker in India, in terms of July 2013 sales numbers. The Dream series of 110cc commuter motorcycles has been at the forefront of Honda's sales growth. Honda managed to sell 2.87 lakh units of its two wheelers in July 2013, compared to Bajaj Auto's 2.81 lakh units in the same period. 

The key difference between the two companies is that Honda managed to achieve a 20% growth in monthly volumes when compared to last year's figures while Bajaj Auto lost 20% in terms of volumes. Hero MotoCorp continues to lead the field, outselling its nearest competitor, with monthly sales figures of 4.88 lakh units. TVS Motors continues it laggard performance, with the South Indian two wheeler maker closing July with 1.54 lakh units, a decline of 5% from last July's numbers.

Honda, by far, has been the biggest gainer in the two wheeler sector with consistent sales increased each passing month, buoyed by new product launches. Honda's strong sales growth is at odds with the overall gloomy outlook in the two wheeler sector despite India getting copious monsoons this year. Two wheeler companies in the country are looking forward to the festive season for cheer, a time when two wheeler sales peak each year. 

Honda's launch blitzkrieg will include a new product launch each quarter for the next couple of years, and this frenetic pace of product launches will be accompanied by a rapid expansion of dealerships across urban and rural India. A 125cc Activa could be the next big launch for the Japanese major. Recently, Honda launched the Activa-i, the least priced scooter in its portfolio, and the Dream Neo 110, its least priced commuter motorcycle.

After its exit from the Hero-Honda joint venture, Honda has aimed at usurping Hero MotoCorp's place from the top of the hustings by 2020, the year by which the Japanese two wheeler maker plans to sell 10 million units per annum in India. Even as Honda is showing signs of moving past Bajaj Auto in the volumes game, the latter has shown no inclination to enter the fast growing automatic scooter segment.

Instead, the Indian company prefers to focus on a high EBITDA margin of 20%, an industry leading figure according to Mr. Rajiv Bajaj, the managing director of Bajaj Auto. The Indian motorcycle major plans to launch 5 more Discover motorcycles to boost its presence in the commuter segment. This festive season, Bajaj Auto will also launch a new flagship motorcycle in the form of the Pulsar 375. Clearly, Bajaj's strategy is sharply focused on the motorcycle market, which is said to yield higher margins than the automatic scooter segment.