Who is the asli (real) Hero – Hero Motocorp or Honda Motorcycle and Scooter India?

Honda Motorcycle and Scooter India hopes to introduce a low cost bike, possibly the cheapest, in India currently being manufactured in China.  It hopes to sell these 125 cc made in China bikes currently sold in some African markets at around Rs 30,000 (ex-showroom Delhi), almost Rs 4,000 lower than market leader Hero’s CD Dawn and about Rs 18,000 cheaper than the Super Splendor.

Tt remains to be seen how Chinese made bikes by Japanese company will be received by Indians. What a paradox – Japanese are taking the assistance of a Chinese company for an market ascendency in an Indian market. This is globalization for you.  

Recently, Honda Motorcycle and Scooter India elbowed out TVS to grab third position in the two-wheeler market. Its next target Bajaj Auto the No 2 two-wheeler company in India.

Honda it is gunning for the budget conscious 100-125 cc bike market, a segment dominated by Hero (although mostly because of Honda’s technology due to the earlier partnership). Sales of 100 cc bikes account for nearly half the Indian motorcycle market.

Honda officials said they are investing more than Rs 1,000 crore over the next year to set up a new factory and increase production capacity to four million units in two years and 10 million units by 2020.

“Our dream is to become the number one motorcycle company in India,” said Keita Muramatsu, president and chief executive officer of Honda Motorcycle and Scooter India, He also added  “Right now, India contributes around 13 percent of our global sales and we want to increase this to 30 percent.”

As a customer I only hope that the customers get benefited from the slugfest. All said and done the latest developments in product design and research and development in two wheeler market are not reaching the Indian customers. It has been new wine in old bottle as far as new product launches have been concerned. Only cosmetic changes - like appearance and brand names have been attempted. Maestro looks like Activa. Whether it is Hero or Honda they need to remember one thing. Customer is the king. Give him the best and he will lavish you with love and he/she will become a fan and a patron for a life time. 

Hero Vs Honda - a mouth watering battle!

It has been a marriage made in the heaven. The marriage  between the mega corporation from Japan Honda and the world's leading maker of cycles Hero. It was a remarkable union. One that stood the test of time. The alliance started in the year 1984 and was intact for more than 25 years (ended in the year 2010.

In Indian Film Industry parlance it celebrated a silver jubilee. Remarkable considering the fact that many other Joint ventures including the once between TVS and Suzuki and Indian government and riage Suzuki motors ran into rough weather.  The resultant acrimonious argument between Suzuki and Indian government had to be settled in the court of law.

Sadly all good things have to end and so did the enormously successful Hero Honda alliance the Joint Venture that gave India the most popular bike – Hero Honda, the bike with the highest mileage “fill it shut it forget it”.

The friends have parted ways.  They are now Hero MotoCorp and Honda Motorcycle & Scooter India Pvt. Ltd. The sniping has started in right earnest. The first salvo was from Honda Motors who won the first battle with its hugely popular Activa the king of the variomatic scooter segment.

Not to be left behind Hero Moto Corporation had unveiled its latest variomatic scooter the Maestro which looks like a carbon copy of the Activa. Analysts are betting their bottom dollar on Maestro being priced at least 10,000/- rupees lower than Honda Activa. Hero is eyeing the variomatic scooter segment and is hungry and envious of the 3 months wait list of Honda Activa.  

Honda Motorcycle and Scooter India has many quivers (arrows) in its bow. And the first off the bow is the announcement that Honda would introduce its own range of motorcycle bikes at a price lower than Hero Moto Corporation’s hugely popular bike – the Hero Dawn. The predatory nature of both the erstwhile partners is out in the open.

On 5th January 2012, Honda Motorcycle and Scooter India unveiled the ‘Dream Yuga’, its first bike aimed at the highly lucrative mass market at the Auto Expo in Delhi.

The 110cc bike, set to be launched in May, was one of seven models (including variants) showcased during the expo. 

Competition (Seeing the trees and missing the forest) – Part 2

In 2008, who was the toughest competitor to British Airways in India? Singapore airlines? Better still, Indian airlines? Maybe, but there are better answers. There are competitors that can hurt all these airlines and others not mentioned. The answer is videoconferencing and tele-presence services of HP and Cisco.

Travel dropped due to recession. Senior IT executives in India and abroad were compelled by their head quarters to use videoconferencing to shrink travel budget. Between 1977 and 1991 the prices of the now dead VCR (parent of Blue-Ray disc player) crashed to one-third of its original level in India. PC's price dropped from hundreds of thousands of rupees to tens of thousands. If this trend repeats then telepresence prices will also crash. Imagine the fate of airlines then. As it is not many are making money. Then it will surely be RIP ( Rest in Peace)!

Who is the competitor to Multiplexes? India has two passions. Films and cricket. The two markets were distinctly different. So were the icons. The cricket gods were Sachin and Sehwag. The filmi gods were the Khans (Aamir Khan, Shah Rukh Khan and the other Khans who followed suit). That was, when cricket was fundamentally test cricket or at best 50 over cricket. Then came IPL and the two markets collapsed into one. IPL brought cricket down to 20 over’s.

Suddenly an IPL match was reduced to the length of a 3 hour movie. Cricket became film's competitor. On the eve of IPL matches movie halls ran empty. Desperate multiplex owners requisitioned the rights for screening IPL matches at movie halls to hang on to the audience. If IPL were to become the mainstay of cricket, as it is likely to be, films have to sequence their releases so as not clash with IPL matches. As far as the audience is concerned both are what in India are called 3 hour "tamasha" (entertainment). Cricket season might push films out of the market.

Look at the products that vanished from India in the last 20 years. When did you last see a black and white movie? When did you last use a fountain pen? When did you last type on a typewriter? The answer for all the above is "I don't remember!" For some time there was a mild substitute for the typewriter called electronic typewriter that had limited memory. Then came the computer and mowed them all. Today most use the computer as an upgraded typewriter. Typewriters per se are nowhere to be seen.

What killed the Alarm Clock? One last illustration. 20 years back what were Indians using to wake them up in the morning? The answer is "alarm clock." The alarm clock was a monster made of mechanical springs. It had to be physically keyed every day to keep it running. It made so much noise by way of alarm, that it woke you up and the rest of the colony. Then came quartz clocks which were sleeker. They were much more gentle though still quaintly called "alarms." What do we use today for waking up in the morning? Cell phone! An entire industry of clocks disappeared without warning thanks to cell phones. Big watch companies like Titan were the losers. You never know in which bush your competitor is hiding!

Competition (Seeing the trees and missing the forest) – Part 1

Who sells the largest number of cameras in India? Your guess is likely to be Sony, Canon or Nikon. Answer is none of the above. The winner is Nokia whose main line of business in India is not cameras but cell phones.

Reason being cameras bundled with cell phones are outselling stand alone cameras. Now, what prevents the cell phone from replacing the camera outright? Nothing at all. One can only hope the Sony’s and Canons are taking note.

Try this. Who is the biggest in music business in India? You think it is HMV Sa-Re-Ga-Ma? Sorry. The answer is Airtel. By selling caller tunes (that play for 30 seconds) Airtel makes more than what music companies make by selling music albums (that run for hours).

Incidentally Airtel is not in music business. It is the mobile service provider with the largest subscriber base in India. That sort of competitor is difficult to detect, even more difficult to beat (by the time you have identified him he has already gone past you). But if you imagine that Nokia and Bharti (Airtel's parent) are breathing easy you can't be farther from truth.

Nokia confessed that they all but missed the Smartphone bus. They admit that Apple's I phone and Google's Android can make life difficult in future. But you never thought Google was a mobile company, did you? If these illustrations mean anything, there is a bigger game unfolding. It is not so much about mobile or music or camera or emails?

The "Mahabharat" (the great Indian epic battle) is about "what is tomorrow's personal digital device"? Will it be a high end mobile or a palmtop with a telephone? All these are little wars that add up to that big battle. Hiding behind all these wars is a gem of a question - "who is my competitor?"

Once in a while, to intrigue any student toss a question at them. It says "What Apple did to Sony, Sony did to Kodak, explain?" The smart ones get the answer almost immediately. Sony defined its market as audio (music from the walkman). They never expected an IT company like Apple to encroach into their audio domain. Come to think of it, is it really surprising? Apple as a computer maker has both audio and video capabilities. So as Kodak defined its business as film cameras, Sony defines its businesses as "digital."

In digital camera the two markets perfectly meshed. Kodak was torn between going digital and sacrificing money on camera film or staying with films and getting left behind in digital technology. Left undecided it lost in both. It had to. It did not ask the question "who is my competitor for tomorrow?" The same was true for IBM whose mainframe revenue prevented it from seeing the PC. The same was true of Bill Gates who declared "internet is a fad!" and then turned around to bundle the browser with windows to bury Netscape. The point is not who is today's competitor. Today's competitor is obvious. Tomorrow's is not.