Hero is losing out on a lot of spheres and it has failed to get traction in its international business as well…
Hero MotoCorp is not making a lot of headways in most of its new ventures formed to beat the expected downfall due to the split with Honda many years back. It has failed to increase its market share in anything over the 125cc motorcycle segment. Its next attempt was to gain impetus in the scooter segment.
In its bid, Hero introduced many models to penetrate in a segment it was not present before. And with its massive reach it was just a matter of striking the right chord with one or two good products. However, after a minor gain initially, Hero has gradually been losing out and as it stands today, it has gone down a very small Suzuki, as the fourth largest scooter seller in the country (more details).
The other expansion strategy was to focus on international markets. In pursuit, Hero formed a subsidiary called as HMCL which invested in Erik Buell Racing (EBR). The plan was to launch motorcycles in USA and Canada in 2014. However, neither EBR branded motorcycles nor Hero’s badged products could eventually be introduced in the American market.
In a broader scenario, Hero has not been able to increase its international presence significantly. Last financial year, Hero could export only 2.6 percent of its production outside India. For reference, rival Bajaj Auto shipped out over 40 percent of its produce and is country’s largest two-wheeler exporter at the moment.
Hero claims to be selling its products in 37 countries as of now and it reiterates that its focus is on the developing and emerging markets of South and Central America, Africa and Asia.
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This leaves Hero with its other operational firm HMCL Americas in USA, however, it is responsible for markets like Argentina, Colombia, Ecuador, Honduras etc. The upcoming BS6 emission norms will be Hero’s Achilles heel – we have discussed it in this story.
Source – Money Control
