Hero Honda, world’s largest two-wheeler manufacturer, is now focussing on ultra low cost bikes to be priced around Rs 20,000. The company says that these low-cost bikes could easily alter the dynamics of the market.
These low-cost bikes will be equipped with smaller displacement engines – one a 75cc and the other 110cc. The company is considering several options to compete with the ‘Made in China’ cheaper bikes from its rival Bajaj and this is one of them. Hero Honda sources indicate that a number of components of these new bikes will be shared with highly depreciated products like Splendor and the bikes will be rolled out in a 12-18 month timeframe.
Hero Honda is likely to shift the manufacturing of its premium bikes like the Karizma and Hunk to its Haridwar plant to take advantage of tax breaks there, which would also free up capacity for the new small bikes at Gurgaon and Dharuhera.