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Hero MotoCorp to drop Honda tag from all models this month

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The country's largest two-wheeler maker Hero MotoCorp will complete dropping the badge of its erstwhile joint venture partner Honda from all its existing products within this month, two years ahead of schedule.

Buoyed by good response to its new model Maestro, which was launched under the Hero brand, the company is also doubling its scooter production capacity to 60,000 units a month.

Moreover, it is also hiking the production capacity of its 125 cc bikes to 75,000 units a month.

"The acceptance of our new identity and the market response that we have received on our three new Hero branded models--Impulse, Maestro and Ignitor--make us confident to go ahead. Our entire range of products would have moved to the Hero brand within this month," Hero MotoCorp Senior Vice-President (Marketing & Sales) Anil Dua told PTI.

The company had begun the exercise of dropping the Honda badge from its products starting with its best-selling model range Splendor in April this year.

"Now almost all of the models have moved to the Hero brand and only CD Dawn and CD Deluxe are left," he said.

Currently the company sells 18 models in the market, out of which three were launched under the Hero brand after the firm announced its new brand identity in London last August. The 15 other models have been sold under the erstwhile Hero Honda brand.

As part of their parting agreement, Hero MotoCorp has time till 2014 to use the Honda brand in its products. In December 2010, the Indian promoter of the firm, the B M Munjal family, had agreed to buy out the entire 26 per cent stake of Honda in Hero Honda for Rs 3,841.83 crore. It brought an end to a 26-year-old successful joint venture.

On increasing scooter production capacity, Dua said: "The Maestro, which is targeted to young men, has done well. It has complemented our other scooter Pleasure which is targeted to women. Therefore, we are increasing scooter capacity to 60,000 units a month".

Earlier the company had a scooter production capacity of about 30,000 units a month. Its scooter sales in August stood at 42,836 units, a jump of 51.62 per cent from the same month last year.

For the April-August period this fiscal, Hero MotoCorp's scooter sales were at 1,87,846 units as against 1,58,825 units in the year-ago period, up 18.27 per cent.

Commenting on the 125cc bike segment, he said: "With Ignitor coming in, we have expanded the portfolio in this segment to four models. Also, we are increasing the production capacity of this segment to 75,000 units a month and we may even increase it further."

The company's existing capacity is about 60,000 units per month, he said, adding, "we are doing extremely well and moving faster in the 125 cc segment in this otherwise suppressed market".

Dua said the investments on the capacity hike will be a part of the Rs 2,575 crore plan announced in June for expansion. This includes setting up two new plants in Gujarat and Rajasthan and an R&D centre by 2013-14.

Asked about the festive season, he said: "The overall market has slowed down but we expect the situation to change in the festive season. With our new models doing well, we are looking forward to it optimistically".

In order to boost sales during the festivities, he said the company will be "investing a lot on advertising and on-ground activities like test rides" to promote the Hero brand and its products.

"During the cricket T20 World Cup, we will be airing new advertisements for the Maestro, Ignitor and another in the premium segment," Dua said. 

Story first published on: September 12, 2012 15:11 (IST)

Tags: Hero Honda, Hero MotoCorp

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