The government has aimed to achieve 100% electrification of the domestic two-wheeler segment by FY2030. However, the motorcycle segment and 50% of scooters are likely to remain ICE (internal combustion engine) by FY31, Hero MotoCorp’s CEO Niranjan Gupta tells Fortune India at the sidelines of the launch of Hero MotoCorp’s new Karizma XMR. According to Gupta, the percentage of market share in motorcycles and scooters is 65% and 35% in the overall two-wheeler segment.
"Electric vehicles, given various reasons such as the use case, customers, the cost structure, are more likely to be a scooter thing and not a motorcycle thing, atleast for the foreseeable future. It is in the scooter segment that the electric vehicle transition is happening. By FY30-31, we can probably see about 50% of scooters undergoing electric vehicle transition. But that means the motorcycles and half of the scooters will still remain ICE. So, ICE and EV are going to coexist for a long time," says Gupta.
The country's largest two-wheeler manufacturer, which launched Vida 1 electric scooter in December last year, plans a presence in atleast 100 cities in terms of EVs by December, according to Gupta. Currently, the company has the electric two-wheeler in the premium segment and plans to launch electric vehicles in the mid-segment and affordable segment by FY25.
With the launch of Karizma XMR, which is priced at ₹1.73 lakh, the company also plans to expand its foothold in the premium category. This is the third premium product by Hero MotoCorp in the past three months. The company has already launched the Xtreme 160R4V motorbike in June and the Harley Davidson X440 motorbike, in partnership with US-based Harley Davidson, in July this year. Both Xtreme 160R4V and Harley Davidson 160R4V are priced at ₹1.27 lakh and ₹2.20 lakh, respectively.
Gupta says that with an increase in capital allocation in the premium segment, Hero MotoCorp's focus will be more towards premium segment and EVs. The company plans to launch three to four products in the premium segment by the next few quarters.
"In the entry-level segment and deluxe segment, our job is to grow the category. It’s not about market share anymore. In the premium segment, we aim to win because we didn’t have a full portfolio earlier. We will focus more on the premium segment because that’s where we need to win," says Gupta.
"The premium segment has an exciting future. Last year, the premium two-wheeler segment grew 20-25%. We expect all premium categories to grow very fast in the next 5 to 7 years. We did not have any presence in this segment, therefore we are launching products where we’ll have the gains of market share and the segment is also growing. So, it’s a sweet spot for us to be at the right time in this segment," adds Gupta.
With Karizma XMR's launch, the company is targeting the age group of 25-45 years.
On its partnership with Harley Davidson, Gupta says that Hero MotoCorp is ramping up the production capacity of Harley Davidson X440 motorbikes to make deliveries faster. The company has so far received 25,000 bookings of Harley Davidson X440. "The deliveries will start from October onwards. We will try to fulfil as many customers as fast as we can. We will try to fulfil that in four months' time starting from October. We are ramping up the capacity to make that faster," says Gupta.
