HMSI to establish its third Plant in Karnataka

Honda Motorcycle & Scooter India (Pvt.) Ltd. (HMSI), Honda’s wholly-owned motorcycle production and sales subsidiary in India, announced plans to expand production capacity of its second motorcycle production plant, which is currently under construction, and to build a third motorcycle production plant to meet increasing demand in the rapidly growing motorcycle market in India. In order to realise Honda’s vision to provide good products with speed and affordability, the third plant will be built in the Bangalore area in the southern part of India, which will enable HMSI to more efficiently serve the vast motorcycle market of India together with the first and second plants in northern India. The third plant is scheduled to become operational in the first half of 2013, with annual production capacity of 1.2 million units. Even though the company has not revealed the investment figures for the third plant, industry officials peg the amount to be around Rs.1,000-1,500 crore. The second plant is currently being built in the Tapukara Industrial Area of Rajasthan, which is approximately 90km from the center of Delhi, and is scheduled to become operational in July 2011 with annual production capacity of 0.6 million units. HMSI decided to double the annual production capacity of this plant to 1.2 million units in March 2012. Utilising production technologies refined at the first plant as a starting point, HMSI will strive to improve process ergonomics and employ more advanced automation and other measures to reduce the burden on associates at the second plant. It will also be more environmentally responsible plant by proactively reducing energy consumption during production and by employing other environmental measures such as water recycling. This capacity expansion plan will increase HMSI’s total annual production capacity to 4 million units, including 1.6 million units at the first plant, 1.2 million units at the second plant and 1.2 million units at the third plant, preparing HMSI for further and rapid growth of the market. India represents the world’s second largest motorcycle market behind only China, and industry-wide motorcycle sales in India for 2010 reached 11.32 million units (up 30pc compared to 2009). HMSI was established as a wholly-owned motorcycle production and sales subsidiary of Honda in 1999 and began production in 2001. HMSI’s sales have grown steadily with 2010 sales of approximately 1.526 million units (up 40pc compared to 2009) achieving a record high for ten consecutive years. In order to fulfill the diversifying needs of customers in the growing market of India, HMSI is enhancing its product lineup with last year’s introduction of CB Unicorn Dazzler, its first model in the 150cc class that was targeted toward young consumers, and by introducing CBR250R, HMSI’s first 250cc sports bike.