Hero Honda to launch new bike in Sept

NEW DELHI, Aug 7 Reuters is reporting that India's largest motorcycle maker, Hero Honda Motors Ltd, said on Wednesday it would launch in September one of two new models it plans to introduce in the year to March 2003.

New models, which generate excitement by offering new features, are key to driving sales in India's rapidly expanding motorcycle market, which grew a scorching 37 percent to 2.89 million bikes in the past year.

"We will announce next month the product and the price," Hero Honda Chairman Brijmohan Lall Munjal told reporters on the sidelines of a news conference, but declined to reveal the model's features or the segment at it will be aimed.

But in April, when Hero Honda introduced 'Dawn', a 100cc economy bike targeted at the rural consumer, it said it would launch an over-200cc sports bike late this financial year.

The New Delhi-based company, in which India's Munjal family and Japan's Honda Motor Co each hold a 26 percent stake, dominates India's bike market with its 100cc, four-stroke fuel-efficient bikes.

In the first quarter, April-June it had a commanding 46 percent share of the domestic market, the world's second-largest after China.

But it faces increasing competition from second-ranked Bajaj Auto Ltd <BJAT.BO>, which makes bikes using Kawasaki technology, and the No 3 firm, TVS Motor Company Ltd, a former Suzuki joint venture.

Bajaj has launched a slew of new bikes over the past year and TVS, too, introduced a four-stroke motorcycle that can compete with Hero Honda's models in terms of fuel-efficiency.

EYEING RAIN

Munjal said there had been no impact yet of the failed monsoon rains on Hero Honda's sales, but said he expected them to drop if it didn't rain in the deficient areas in the next 10 days.

The June-September monsoon, which brings 80 percent of agriculture-dependent India's rains, is crucial to driving overall demand in the economy.

Nearly half of Hero Honda's sales in the past year are estimated to have been in rural areas, where nearly a third of its dealers are located.