Honda prepares for Activa EV scooter with increased production
Honda is enhancing its manufacturing capabilities in anticipation of the upcoming Activa EV scooter in India. The company had previously downsized its expansion plans due to the implementation of BS6 Stage 2 norms before the pandemic. Now, it's refocusing on boosting production. To meet the growing demand for internal combustion engine (ICE) and electric vehicles, two new production lines have been set up at factories in Gujarat and Karnataka.
Honda's new production lines
The production of the Honda electric scooter is slated to begin by December 2024, at the Karnataka plant. An additional line at the Gujarat facility is expected to contribute an extra 6.6 lakh units, with a dedicated EV production line planned for FY25. This expansion aims to meet production needs for the second half of this fiscal year, adding an estimated total capacity of around nine lakh units annually.
Honda's anticipated future growth
The eagerly awaited Activa EV from Honda, codenamed K4BA, is scheduled to hit the roads in FY25. Despite not yet reaching its pre-pandemic peak, Honda Motorcycle & Scooter India remains hopeful about future growth, leading to these capacity enhancements. The company is targeting a strong double-digit growth of over 15% in FY25, which would mark its fourth consecutive year of growth and bring it closer to its earlier peak of 5.9 million units in FY19.
Honda's production forecasts
Honda anticipates an 11% increase in scooter production next fiscal year, with volumes exceeding three million units. Motorcycle production is estimated at 2.65 million units, indicating a growth of 23%. In the last fiscal year, Honda reported a domestic sales increase of 13%, selling approximately 4.5 million units, and securing a market share of 25% in the overall two-wheeler market.
Honda's market share and future EV plans
Despite new competitors entering the market with their EV products, Honda managed to sell roughly 2.5 million scooters in FY24, claiming a market share of 43%. In the motorcycle segment, the company sold nearly two million units, boosting market share by 17%, largely due to the popularity of the new Shine 100. As Honda prepares to enter the EV sector later this fiscal year with its electric scooter, it plans to leverage product upgrades to further increase its market share.
