Munjals deny Honda exiting joint Hero Honda

With arch rival Bajaj Auto making inroads in the entry-level bike segment, India's largest two-wheeler maker Hero Honda has acknowledged that its leadership position may no longer be secure.

Besides, there is also some speculation currently about its Japanese partner Honda exiting the joint venture even as the company sees it market share decline in the 75-125cc motorcycles category.

Its market share was down to 68.9 per cent in the April-August period this fiscal from 81.8 per cent in the same period of 2009-10.

''Increasing competition across all key segments, including the bread-and-butter deluxe segment, will put some pressure on market share,'' the company said in its annual report for 2009-10.

Meanwhile, Bajaj Auto, which re-entered the volume-driven 100cc segment in July last year with its 'Discover' brand priced at Rs 40,000 (ex-showroom, Delhi) has substantially strengthened its position at Hero Honda's expense. Since the launch of the 100cc Discover, Hero Hondas sales have taken a beating.

In contrast, Bajaj Auto's share in the segment rose to 19.5-per cent over the last five months at 5,05,724 units from 1,99,790 units in the year-ago period. Hero Honda has six products in the volume-driven 100cc segment - CD Deluxe, CD Dawn, Splendor+, Splendor NXG, Passion Pro and Passion Plus.