Oct 3, 2006

1 Bajaj Vs Hero Honda

Indian Express:
NEW DELHI, OCTOBER 2 : The battelines are drawn between the two rivals in the two wheeler segment this festive season. Bajaj Auto, which has been inching closer to the numero-uno position in the last few months is now at a sniffing distance from arch rival Hero Honda.
The sales figures for September show the two companies are now separated by 30,000 units—a big drop from the 1-lakh plus difference in the last fiscal. While Bajaj has been steadily improving its market share—currently at 37.9 per cent—Hero Honda's has been feeling the heat from new competitors like its own HMSI.
“Bajaj has put in a lot of effort and planning in its new products and is reaping the benefits. Hero Honda's new products, on the other hand, have not been well received and the Splendor has now started to lose its charm and looks dated," said a Society for Indian Automobile Manufacturers (SIAM) official.

Though Hero Honda's sales have picked up in the last month, against a continuous decline in July and August, the growth is below that of Bajaj, which posted a 50 per cent jump in sales to 271,377 units, against 180,926 units in September last year. Hero Honda's was a modest 13.34 per cent jump year on year registering sales of 301,577 units last month.

The signs are ominous for the market leader when one compares the difference between the two companies a year back in September 2005. Selling over 85,000 motorcycles more than Bajaj, Hero Honda was then undisputed leader. While it may still be premature to say Bajaj has won the war, it is winning the monthly battles nevertheless. In August 2006, Hero Honda sold 196,704 units in its forte —the 750-125 cc segment— against 233,078 units a year back. Bajaj on the other hand sold 95,549 units in the segment as against 75,545 units in August 2005. What is interesting is that the overall size of the segment declined by almost 3.5 per cent in the course of one year. In the 125-250cc segment however, things were radically different. Not only had the segment expanded by 36 per cent, Bajaj reinforced its strength in the segment while Hero Honda's sales declined.

It does seem that its a full circle for Bajaj which was at the receiving end of market dynamics in the beginning of the new millennium when the market for 150cc scooters dried up overnight to give way to 100cc fuel efficient motorcycles. It was Hero Honda then with its Splendor which capitulated on the opportunity ensuring in the process that Rahul Bajaj's dream of becoming the largest scooter manufacturer in the world remains just a dream.


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lakshmi said...

Thank you for sharing this post.

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