Japanese auto major Honda’s Indian two-wheeler arm could take around two-three years to start production on the third line of its Gujarat plant, as demand has shrunk in the wake of coronavirus pandemic, according to a senior company official.
Honda Motorcycle & Scooter India (HMSI) had gone ahead with the construction of a third line to add 6 lakh units per annum at the Gujarat plant, having a total capacity of 12 lakh units per annum.
At present, HMSI has four manufacturing plants in India located at Manesar (Haryana), Tapukara (Rajasthan), Narsapura (Karnataka) and Vithalapur (Gujarat) with a total annual production capacity of 64 lakh units.
While the two-wheeler industry has been hit hard by the coronavirus pandemic, HMSI has had its own challenges considering the fact that scooter sales happen mainly in urban India, which had been in the lockdown for a considerable number of days compared to rural India, where mainly motorcycles that too entry-level models are high.
In terms of its product mix, it sells 60-65 per cent scooters and the rest of the business is coming from its motorcycle business.Â
Amid challenges of the pandemic, HMSI has last week initiated a VRS scheme for permanent workers as a part of Honda’s overall production realignment strategy across all four factories to improve its operational efficiency with the objective of ensuring long-term business sustainability.
