As part of its strategy to increase its presence in the growing premium motorcycle market, Hero MotoCorp, the country's largest two-wheeler maker, plans to have a product portfolio of more than half a dozen premium bikes. This corroborates our report from June 2023 that Hero MotoCorp was developing four premium motorcycles, two in the core premium segment and two in the upper premium segment – i.e two Harley X440-based models.
- Hero to expand premium motorcycle lineup from current two models to six models
- Plans to have 100 exclusive stores for top-end bikes
- Investment of about Rs 1,000 crore to be mostly used for premium bikes, EVs
Having a modest presence so far with just the Xtreme and Xpulse models, Hero MotoCorp is upping the ante by bringing back its popular nameplate, in the form of the Karizma XMR. Considering the attractive (and introductory) price of Rs 1.73 lakh (ex-showroom, Delhi), this will help the company bring in incremental sales.
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Niranjan Gupta, CEO of Hero MotoCorp, said that the premium motorcycle market is growing at double the pace of the mainstream bike market, and the company plans to offer a variety of form factors and choices across price points.
In the past, a major factor that held Hero back in the premium segment were the limited number of offerings, Gupta had said. With a new portfolio of products and a complete 360-degree showroom and aftersales experience, the brand is looking to win in the space.
“At the premium end of the market, customers are willing to try out different brands and we intend to have a full portfolio of bikes. We have about 5 percent market share in the premium bike segment, but the game for us is starting now. Each of these bikes will add to the puzzle we are putting together, and this will be backed by a 360-degree premium experience, too,” said Gupta.
Hero MotoCorp at present offers a street bike and an adventure bike – the Xtreme and the Xpulse – and it sold about 70,000 motorcycles in FY23. With the addition of the Karizma, Harley-Davidson X440, and its own version of the 440cc bike, which is likely to be more youthful and sportier, the company may potentially double its premium bike sales with these new additions, albeit on a low base.
The company plans on having 100 exclusive stores for its premium bike portfolio and plans to revamp its current 500 outlets, under its Hero 2.0 retail plan. Hero MotoCorp has lined up an investment of Rs 1,000 crore in the current fiscal year, predominantly for its premium bikes and electric vehicles. While its core segment, where the Splendor rules the roost, will continue to have product enhancements, the major disruptions in products from the company will be in the premium end, and include EVs, said the company executives.
"The portfolio building will continue – there will be one new bike every quarter for the next one year, and all this will add up to our premium positioning in the future.” When asked what is the market share vision, Gupta declined to share specifics, but stated, “We are in it for the long term, and the share should only grow.”
While the market is growing at a single digit rate so far, Hero MotoCorp is planning to grow by double digits in FY24, led by a new range of products. The initial feelers from the festive season have been very positive.
Gupta told our sister publication Autocar Professional, “The recovery in the entry segment is slow, the potential is huge, expected penetration in future is large. There is still a lot of unserved demand, which is waiting to be tapped. It is only a matter of time until the core entry segment will make a comeback."
Over the years the share of the 100-110cc segment, which has been the core of Hero MotoCorp, has gone down. However, the share of the premium motorcycle segment has gone up. In a 1.9 million-unit premium motorcycle market (bikes with capacities above 150cc), Hero MotoCorp sold merely 69,000 units in FY23, which is a market share of 3.7 percent.
When asked on the potential mix of mass motorcycle and premium motorcycle segment in the future, Gupta said the Indian market is not yet saturated, and the segment mix is very dynamic as there are different sets of customers in different segments. He also said that the mix will keep changing. “The opportunity for the future is even bigger and all segments will continue to find buyers,” he added.