Honda's motorcycle project rivaling Royal Enfield put on the backburner

Cost effectiveness is the key in this segment and HMSI has limited exposure in the 250cc-500cc segment. Hence the company requires more time for the final product.

2017 Honda Rebel (Representational image)Honda

Japanese automaker Honda revealed its plan to launch a middleweight motorcycle in March. It was also reported that Honda Motor Co. has assembled a team of engineers from Japan and Thailand to develop the motorcycle that will give serious challenge to the Royal Enfield.

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However, emerging reports indicate the debut of the motorcycle will not happen anytime soon since the company has a lot of homework to do before coming up with final product. A report in Livemint claims president and CEO of Honda Motorcycle and Scooter India (HMSI), Minoru Kato has now revealed that the plans for the motorcycle have been put on the backburner.

"So far, from my point of view, the cost competitiveness as of today is not enough to compete in that segment," Kato said. HMSI is very cost-competitive in big-volume models like the Activa scooter, which comes in 110cc and 125cc versions, but it doesn't have the experience of developing motorcycles in the above-250cc (up to 450cc) segment, he said. Cost effectiveness is the key of this segment and HMSI has limited exposure in the 250cc-500cc segment. This will demand more time and engineering for the company to bring the final project.

Royal Enfield commands nearly 95 percent of the 350cc motorcycle market share in India and is also fast expanding its global foot print. The Chennai-based motorcycle maker has been enjoying the pole position in the segment with no rivals. Hence, Honda's Royal Enfield beater has to be a no-nonsense product at an ideal price range. With the slow pace in developments, arrival of Honda's 250cc middle-weight product is expected only in the second half of 2018.

Bajaj Auto recently launched Dominar 400 and surging demand for the motorcycle saw Bajaj Auto overtaking Royal Enfield in 350cc to 500cc motorcycle segment sales in February. The dream start of Dominar 400 in Royal Enfield's turf seems to have prompted Honda to focus attention on the middleweight segment.