Chennai: Rising prices of key commodities like steel and rubber have led to twowheeler companies going for price mark-ups. Both TVS Motor and Bajaj Auto have opted for price hikes in the past couple of weeks and market leader Hero Honda is in a wait-and-watch mode. Further hikes are ruled out in the April-June quarter.
The Chennai-based TVS Motor Company went in for a 1.5-2% price hike in the first week of April. The hike covered its entire range including three-wheelers. “This was on account of steel and rubber price hikes and the increase in overhead costs for suppliers. We have passed on a miniscule part of the cost increase so we will definitely look at the price line again once we come to know the full extent of the impact by the end of May. We will take a call on further price revision in June,” H S Goindi, president, TVS Motor, said.
Bajaj Auto also increased prices of its products in the first week of April and marked up export prices beginning May. As for TVS, the commodity price pressure in March has been the trigger. However, there’s no talk of further price hikes immediately.
In Hero Honda’s case, the price line remains unchanged for now but the company is in a monitoring mode. “We are monitoring the commodity situation closely and keeping all our options open,” said Anil Dua, senior vice-president (marketing and sales), Hero Honda. Hero Honda took a price increase in March and is therefore holding prices now.
Tax Sop Phaseout Fears Pull Down Export Stocks
Talk of non-renewal of duty entitlement scheme after June 30 hits Bajaj Auto, Dr Reddy’s and others
Bajaj Auto, Dr Reddy’s Laboratories and TVS Motor plunged for a second consecutive day on speculation that a popular tax incentive to exporters may be done away with by June.
The Duty Entitlement Pass Book, or DEPB, a scheme that reimburses duty paid on imported inputs that go into exports, is scheduled to end on June 30. It may not be extended since the finance ministry is seeking more avenues for revenues when the economic growth rate is forecast to fall due to higher interest rates.
Analysts say that if the scheme is not extended it will have an adverse impact on companies that depend on exports for substantial revenues. These firms are from across sectors such as pharmaceuticals, petrochemicals, engineering and automotive components. The DEPB scheme is popular among exporters as it reimburses customs duty paid by them on inputs through dutyfree scrips that can be sold freely in the market. Since the reimbursement rates are predetermined, based on the value of exports, exporters don’t have to necessarily import inputs. In that sense, it is a kind of subsidy for exports
“Apart from the DEPB, investor sentiment was also impacted because of the rate hike by the central bank,” said Murali Krishnan, head-institutional equities, Karvy Stock Broking. Automobile sales may taper off in the coming days as high interest rates and higher petrol prices may force customers postponing purchases. Most of the auto stocks reacted to news negatively led by Bajaj Auto and TVS Motors and pharma major Dr Reddy’s Laboratories as investors trimmed their holdings.
While Bajaj Auto closed the day at . 1,285.35, down 1.2%, from its previous close, TVS Motors ended 3.5% lower at . 53.30. Dr Reddy’s slipped 1% to end the day at . 1,582. About 70% of DRL’s formulations are exported and analysts see margins impact on the company of 3-4% if DEPB not extended.
It may be too early to conclude the export subsidy may be done away with exporters lobbying intensely for the continuation of the scheme for at least another five years. “On behalf of all exporters I have made a presentation to the ministry urging it to extend the scheme so that exporters can negotiate better with the buyers,” said FIEO president Ramu Deora.
Bajaj Auto, Dr Reddy’s Laboratories and TVS Motor plunged for a second consecutive day on speculation that a popular tax incentive to exporters may be done away with by June.
The Duty Entitlement Pass Book, or DEPB, a scheme that reimburses duty paid on imported inputs that go into exports, is scheduled to end on June 30. It may not be extended since the finance ministry is seeking more avenues for revenues when the economic growth rate is forecast to fall due to higher interest rates.
Analysts say that if the scheme is not extended it will have an adverse impact on companies that depend on exports for substantial revenues. These firms are from across sectors such as pharmaceuticals, petrochemicals, engineering and automotive components. The DEPB scheme is popular among exporters as it reimburses customs duty paid by them on inputs through dutyfree scrips that can be sold freely in the market. Since the reimbursement rates are predetermined, based on the value of exports, exporters don’t have to necessarily import inputs. In that sense, it is a kind of subsidy for exports
“Apart from the DEPB, investor sentiment was also impacted because of the rate hike by the central bank,” said Murali Krishnan, head-institutional equities, Karvy Stock Broking. Automobile sales may taper off in the coming days as high interest rates and higher petrol prices may force customers postponing purchases. Most of the auto stocks reacted to news negatively led by Bajaj Auto and TVS Motors and pharma major Dr Reddy’s Laboratories as investors trimmed their holdings.
While Bajaj Auto closed the day at . 1,285.35, down 1.2%, from its previous close, TVS Motors ended 3.5% lower at . 53.30. Dr Reddy’s slipped 1% to end the day at . 1,582. About 70% of DRL’s formulations are exported and analysts see margins impact on the company of 3-4% if DEPB not extended.
It may be too early to conclude the export subsidy may be done away with exporters lobbying intensely for the continuation of the scheme for at least another five years. “On behalf of all exporters I have made a presentation to the ministry urging it to extend the scheme so that exporters can negotiate better with the buyers,” said FIEO president Ramu Deora.
What drives branding decisions?
As branding choices are strategic and brand architecture decisions complex, several factors come into play while deciding a specific branding strategy.
In the light of the recent statement made by Rahul Bajaj regarding using the mother/master brand “Bajaj”, it is indeed interesting to explore what, in organisations guides branding decisions and strategies. Rajiv Bajaj had said the ‘Bajaj' name will be done away with from the motorcycles as the brand has been diluted, as it has a presence in different fields ranging from electricals to insurance to automobiles. He had also stressed that products like the Pulsar, Boxer and Discover have become brands by themselves, as a result of which the Bajaj brand has become “more like a garage”. The father, however, had ruled out dropping the ‘Bajaj' brand, as opposed to an idea toyed by Rajiv. Rahul Bajaj was also quite vocal in expressing unhappiness when his son, in a statement in December last year, decided to bring down the curtains on its scooters, thus ending the story of ‘Hamara Bajaj'.
But, recently Rahul lauded Rajiv (MD of the firm), while addressing shareholders in the annual report for 2009-10: “Your Managing Director often says that while products may generate market share, brands provide pricing power and create higher profits. I am increasingly tending to agree with him.”
Where some companies, like P&G which does not club its hair care products under a brand name, such as a P&G shampoo, there are others like Virgin, Nike, Samsung, Dabur and Godrej which use the mother brand name for their entire range of products. As for the Tata Group, group companies actually pay brand royalty to Tata Sons for using the Tata brand.
Those that use the name directly pay 0.25 per cent of the turnover or 5 per cent of profit before tax, whichever is lower; those that use the Tata brand name indirectly (like The Indian Hotels, for example) pay 0.15 per cent of the turnover.
So what really drives these branding decisions? Branding is one of the most significant aspects of business strategy. It is central to creating customer value and competitive advantage. It is not something that can be isolated from the main business and given as a task to the advertising team /communication manager as a set of activities. Marketers believe customer value is more perceptual than real and that it depends on subjective understanding of customers and less about objective facts. Consider Dettol, for instance; some images that come to mind perhaps would be: a doctor in a white coat, a strong protector with a sword, a caring and protective mother and so on.
As Douglas Holt had written, branding is a perspective that focuses on shaping perceptions. Brands are cultures that circulate in society as conventional stories. Cultures are shared, taken for granted stories, images and associations and these get authored by companies themselves, customers and influencers. Sometimes, we experience that even if we forget the product, we attribute stories and images to a brand. As these stories interact with other similar stories daily, a common view point/ a common story emerges, which is in a sense a consensus view about a brand,” says Holt. At this point a brand becomes what Holt calls a “cultural artefact”.
Psychological research demonstrates brand cultures are durable because people are so overloaded with information they rely upon a few heuristics to simplify the world. Brand cultures work as one such heuristic. Aaker and Joachimaster compare and contrast between a branded house strategy (a Samsung, for example) and a house of brands strategy (like P&G) as two extremes of alternative brand architectures. While a branded house uses a single master brand to span a set of offerings, the other involves an independent set of standalone brands, each maximising the impact on the market.
Take Croma, for instance. Croma is a 100 per cent subsidiary of Tata Sons. “When Croma first came to India, the grey market for electronics was dominant and hence we had to depend on the strength of our mother brand for credibility. Even the ‘touch, feel and try' retailing was new to India. People would not know what Croma meant but they would associate strongly with the Tata brand,” recalls Ajit Joshi, Managing Director, Croma. “The success of our brand is also strongly because of our private labels. Today we have 49 per cent penetration in vacuum cleaners and 18 per cent penetration in microwave ovens. While we started as an electronics megastore, we soon developed new categories of products like jewellery cleaners, foot spas and car seat massagers to cater to well-researched customer needs in areas where we had no competition. As we grew the “Tata” name always stood by us to provide assurance and credibility,” explains Joshi. Croma uses this interesting brand strategy called the token endorser strategy.
There are multiple reasons for companies to adopt a house of brands strategy.
Targeting niche markets and focusing on functional benefits (Head & Shoulders for dandruff control and Pantene for enhancing hair vitality), signalling breakthrough advantages of new offerings or even to value chain elements like minimising channel conflict or even avoiding a brand association that would be incompatible in an offering. While usually, sub-brands in the portfolio inherit the values of the mother brand, the opposite also holds true. Sometimes, it's a flagship brand that imbues values to the mother brand, which then gets passed on to other sub-brands. Fiat too, for instance, has associated brands like the Ferrari, Maserati and Lancia that cater to unique market segments. While the company could explore interesting ways of leveraging these brand associations for international markets, the fact is that these brands have a distinct identity in terms of the niche they cater to, their functional benefit and customer value.
There are reasons why companies would use the branded house strategy as well. Particularly in emerging markets like India, a branded house strategy would in some sense help fill “institutional voids”. An excerpt from Tarun Khanna and Krishna Palepu's paper on emerging markets gives an interesting perspective on this. As emerging markets are hardly uniform, they fall short to varying degrees in providing the institutions necessary to support basic business operations. As regards product markets, first, the communications infrastructure in emerging markets is often underdeveloped; second, even when information about products does get around, there are no mechanisms to corroborate the claims made by sellers; consumers have no redress mechanisms if a product does not deliver on its promise. As a result of this lack of information, companies in emerging markets face much higher costs in building credible brands. In turn, established brands wield tremendous power.
A conglomerate with a reputation for quality products and services can use its group name to enter new businesses, even if those businesses are completely unrelated to its current lines. Groups also have an advantage when they do try to build up a brand because they can spread the cost of maintaining it across multiple lines of businesses.
“There is an interplay between the mother brand and the sub-brand that is important to understand,” says P. M. Telang, MD, India Operations, Tata Motors. “The Tata brand stands for concern, integrity, ethics, corporate social responsibility, reliability and trust and Tata Motors has derived strength from it. For example, in spite of the initial problems we had when we launched the Indica, we eventually sailed out of it. People knew that the Tatas won't let them down and gave us time till we launched the V2. Having said that, Tata Motors too has contributed to its mother brand by producing reliable products, be it commercial vehicles or passenger cars. “Given that we stand for values and integrity, we have easier access to international markets and world-renowned players like Bosch prefer to work with us,” says Telang.
Brand architecture decisions are complex and should be taken based on responses to critical questions like - does the mother brand contribute to the offering by adding associations; enhancing the value proposition or credibility with organisational associations or visibility or communication efficiencies? Will the mother brand be strengthened with the new offering? Will the new offering be able to leverage the strength of its mother brand? Is there a need for a separate brand because it will create its own associations, represent a new different offering, avoid an association or retain/capture customer/brand bond? Will the business support a new brand name?
The options on the branding spectrum are distinct and interesting in terms of frameworks and options like nested sub-brands, endorsed brands. The challenge really lies in creating a family / a brand team where all these fit in and are productive.
(Dr Mukta Kamplikar is Head, Strategy, for Fiat India Automobiles Ltd. These are her personal views and do not represent those of the company/group.)
In the light of the recent statement made by Rahul Bajaj regarding using the mother/master brand “Bajaj”, it is indeed interesting to explore what, in organisations guides branding decisions and strategies. Rajiv Bajaj had said the ‘Bajaj' name will be done away with from the motorcycles as the brand has been diluted, as it has a presence in different fields ranging from electricals to insurance to automobiles. He had also stressed that products like the Pulsar, Boxer and Discover have become brands by themselves, as a result of which the Bajaj brand has become “more like a garage”. The father, however, had ruled out dropping the ‘Bajaj' brand, as opposed to an idea toyed by Rajiv. Rahul Bajaj was also quite vocal in expressing unhappiness when his son, in a statement in December last year, decided to bring down the curtains on its scooters, thus ending the story of ‘Hamara Bajaj'.
But, recently Rahul lauded Rajiv (MD of the firm), while addressing shareholders in the annual report for 2009-10: “Your Managing Director often says that while products may generate market share, brands provide pricing power and create higher profits. I am increasingly tending to agree with him.”
Where some companies, like P&G which does not club its hair care products under a brand name, such as a P&G shampoo, there are others like Virgin, Nike, Samsung, Dabur and Godrej which use the mother brand name for their entire range of products. As for the Tata Group, group companies actually pay brand royalty to Tata Sons for using the Tata brand.
Those that use the name directly pay 0.25 per cent of the turnover or 5 per cent of profit before tax, whichever is lower; those that use the Tata brand name indirectly (like The Indian Hotels, for example) pay 0.15 per cent of the turnover.
So what really drives these branding decisions? Branding is one of the most significant aspects of business strategy. It is central to creating customer value and competitive advantage. It is not something that can be isolated from the main business and given as a task to the advertising team /communication manager as a set of activities. Marketers believe customer value is more perceptual than real and that it depends on subjective understanding of customers and less about objective facts. Consider Dettol, for instance; some images that come to mind perhaps would be: a doctor in a white coat, a strong protector with a sword, a caring and protective mother and so on.
As Douglas Holt had written, branding is a perspective that focuses on shaping perceptions. Brands are cultures that circulate in society as conventional stories. Cultures are shared, taken for granted stories, images and associations and these get authored by companies themselves, customers and influencers. Sometimes, we experience that even if we forget the product, we attribute stories and images to a brand. As these stories interact with other similar stories daily, a common view point/ a common story emerges, which is in a sense a consensus view about a brand,” says Holt. At this point a brand becomes what Holt calls a “cultural artefact”.
Psychological research demonstrates brand cultures are durable because people are so overloaded with information they rely upon a few heuristics to simplify the world. Brand cultures work as one such heuristic. Aaker and Joachimaster compare and contrast between a branded house strategy (a Samsung, for example) and a house of brands strategy (like P&G) as two extremes of alternative brand architectures. While a branded house uses a single master brand to span a set of offerings, the other involves an independent set of standalone brands, each maximising the impact on the market.
Take Croma, for instance. Croma is a 100 per cent subsidiary of Tata Sons. “When Croma first came to India, the grey market for electronics was dominant and hence we had to depend on the strength of our mother brand for credibility. Even the ‘touch, feel and try' retailing was new to India. People would not know what Croma meant but they would associate strongly with the Tata brand,” recalls Ajit Joshi, Managing Director, Croma. “The success of our brand is also strongly because of our private labels. Today we have 49 per cent penetration in vacuum cleaners and 18 per cent penetration in microwave ovens. While we started as an electronics megastore, we soon developed new categories of products like jewellery cleaners, foot spas and car seat massagers to cater to well-researched customer needs in areas where we had no competition. As we grew the “Tata” name always stood by us to provide assurance and credibility,” explains Joshi. Croma uses this interesting brand strategy called the token endorser strategy.
There are multiple reasons for companies to adopt a house of brands strategy.
Targeting niche markets and focusing on functional benefits (Head & Shoulders for dandruff control and Pantene for enhancing hair vitality), signalling breakthrough advantages of new offerings or even to value chain elements like minimising channel conflict or even avoiding a brand association that would be incompatible in an offering. While usually, sub-brands in the portfolio inherit the values of the mother brand, the opposite also holds true. Sometimes, it's a flagship brand that imbues values to the mother brand, which then gets passed on to other sub-brands. Fiat too, for instance, has associated brands like the Ferrari, Maserati and Lancia that cater to unique market segments. While the company could explore interesting ways of leveraging these brand associations for international markets, the fact is that these brands have a distinct identity in terms of the niche they cater to, their functional benefit and customer value.
There are reasons why companies would use the branded house strategy as well. Particularly in emerging markets like India, a branded house strategy would in some sense help fill “institutional voids”. An excerpt from Tarun Khanna and Krishna Palepu's paper on emerging markets gives an interesting perspective on this. As emerging markets are hardly uniform, they fall short to varying degrees in providing the institutions necessary to support basic business operations. As regards product markets, first, the communications infrastructure in emerging markets is often underdeveloped; second, even when information about products does get around, there are no mechanisms to corroborate the claims made by sellers; consumers have no redress mechanisms if a product does not deliver on its promise. As a result of this lack of information, companies in emerging markets face much higher costs in building credible brands. In turn, established brands wield tremendous power.
A conglomerate with a reputation for quality products and services can use its group name to enter new businesses, even if those businesses are completely unrelated to its current lines. Groups also have an advantage when they do try to build up a brand because they can spread the cost of maintaining it across multiple lines of businesses.
“There is an interplay between the mother brand and the sub-brand that is important to understand,” says P. M. Telang, MD, India Operations, Tata Motors. “The Tata brand stands for concern, integrity, ethics, corporate social responsibility, reliability and trust and Tata Motors has derived strength from it. For example, in spite of the initial problems we had when we launched the Indica, we eventually sailed out of it. People knew that the Tatas won't let them down and gave us time till we launched the V2. Having said that, Tata Motors too has contributed to its mother brand by producing reliable products, be it commercial vehicles or passenger cars. “Given that we stand for values and integrity, we have easier access to international markets and world-renowned players like Bosch prefer to work with us,” says Telang.
Brand architecture decisions are complex and should be taken based on responses to critical questions like - does the mother brand contribute to the offering by adding associations; enhancing the value proposition or credibility with organisational associations or visibility or communication efficiencies? Will the mother brand be strengthened with the new offering? Will the new offering be able to leverage the strength of its mother brand? Is there a need for a separate brand because it will create its own associations, represent a new different offering, avoid an association or retain/capture customer/brand bond? Will the business support a new brand name?
The options on the branding spectrum are distinct and interesting in terms of frameworks and options like nested sub-brands, endorsed brands. The challenge really lies in creating a family / a brand team where all these fit in and are productive.
(Dr Mukta Kamplikar is Head, Strategy, for Fiat India Automobiles Ltd. These are her personal views and do not represent those of the company/group.)
Red Alert - CBR 250
There are many ways to describe the new Honda CBR250R. However, if I had only one way to describe it, it would be ‘path-breaking.’ That’s right, ladies and gentlemen. Indian motorcyclists have always yearned for a ‘real’ performance motorcycle, one that not only looks the part, but also goes the part. While the CBR250R might not appear to be a substantial jump in terms of displacement and power, it is certainly so in terms of performance and what a proper big motorcycle should feel like.
The CBR250R is an important motorcycle for Honda, not just in India but also for its international markets where increasingly the average age of motorcyclists is rising and hardcore sportsbikes are too expensive and intimidating to draw in the younger crowd. Young and old, internationally and in India, the CBR250R is intended to offer people a new experience.
On the Indian front, in a market crowded at the bottom, Honda has set out to capture the higher rungs of the performance segment. And as thousands of enthusiasts will testify, it’s about time too, as Indian manufacturers have always been hesitant to offer a proper 250cc motorcycle for reasons unexplained, never mind the duty-stricken (and hence super-expensive) Kawasaki Ninja 250R. However, it seems Honda has shown them how it’s done. Honda plans to sell around 30,000 units of the CBR250R in its first year — that should open the eyes and ears of its competitors, and it won’t be long before we see similar products rolling off their assembly lines. When it was announced, the CBR250R looked set to be a milestone in Indian motorcycling and after riding it, we think it has already become one.
Makes you wonder why they called it the CBR then, doesn’t it? Well, it’s probably because buyers in this segment probably aspire to Honda’s flagship CBRs, so having the same aura envelop this 250cc motorcycle is a good selling point.
The CBR250R is a well-proportioned motorcycle. It is also bigger than the 220-odd cc motorcycles that we’ve seen in India for some time now. This motorcycle’s face is what grabs people’s attention, while the rest of the bike succeeds in holding that attention, judging by the reactions we got while riding it. It looks sophisticated and fast, while the chunky rubber gives it a planted stance. The instrument console has a digital speedometer, a tachometer and a trip meter along with a clock, a fuel gauge and a coolant temperature indicator. The exhaust is a substantial upswept unit that adds to the sporty look. Overall, it’s quite the looker. The level of quality is top notch too, as expected from a premium Honda.
PERFORMANCE
This is where the fun begins! The CBR250R comes with a 249.6cc four-stroke motor that uses a four-valve head and liquid-cooling to produce 25 bhp@8,500 rpm and 2.33 kgm@7,000 rpm. These numbers are enough to propel the 167 kg CBR to 100 kmph in around 9 seconds, while top speed is in excess of 150 kmph — that’s shattering performance for a 250, really! The lower three gears have enough grunt to keep the rider grinning, while the top three gears continue building the superb acceleration into sensational top speed.
What’s more important is how the motor feels while it’s out on the road — smooth and fast. The six-speed gearbox has well spaced-out ratios that are on the taller side, so you get an excellent highway steed that possesses great in-gear acceleration to overtake any kind of traffic one might encounter. However, the flip side is that in the city, it is not very easy to put it in a higher gear and trundle around; you need to keep working the gearbox. However, all said and done, the CBR250R goes as well as it looks.
Engine efficiency, given the performance and the way we’ve ridden it, is surprising. Out on the highway, cruising in top gear between 5,000 and 8,000 rpm, we got a figure of 45 kmpl. In the city, it drops to 39 kmpl, though it’s not a bad number by any stretch for a bike like this.
RIDE AND HANDLING
The CBR250R’s sporty riding position is excellent — not too upright but not back-breaking either. You feel at home in traffic as well as out on the open roads. The seat, however, could be less firm and makes you thank the CBR’s ride quality, which is great. One cannot term it as plush, but it certainly absorbs everything without unsettling the bike. Going around corners is a comfortable experience, though handling response is not exactly razor sharp, thanks to the fat rear tyre and the bike’s considerable mass. However, even though it feels a bit too soft, everything remains predictable enough for you to enjoy any road that you might chance upon. The best part is the brakes, especially the optional Combined Anti-lock Braking System (C-ABS) package, with which you get strong braking power via the 296 mm front disc. You only have to squeeze the front lever and the CBR simply stops without any sign of getting out of shape
WHAT YOU GET
An accomplished motorcycle that’s fantastic value for money. By pricing the CBR250R at Rs 1.51 lakh for the base model and Rs 1.71 lakh (ex-showroom, Mumbai) for the C-ABS version, Honda has dealt a serious blow to nearly everything in the premium motorcycle segment.
To be honest, the CBR is more than just a brilliant motorcycle. It’s a wake-up call for every other manufacturer who has ignored Indian motorcycling enthusiasts’ pleas for a well-engineered and fast motorcycle that’s also value for money. By deciding to make it here in India, Honda has again shown faith in the Indian motorcycling market and stolen a march on its rivals at the same time. Reward then, is assured.
The CBR250R is an important motorcycle for Honda, not just in India but also for its international markets where increasingly the average age of motorcyclists is rising and hardcore sportsbikes are too expensive and intimidating to draw in the younger crowd. Young and old, internationally and in India, the CBR250R is intended to offer people a new experience.
On the Indian front, in a market crowded at the bottom, Honda has set out to capture the higher rungs of the performance segment. And as thousands of enthusiasts will testify, it’s about time too, as Indian manufacturers have always been hesitant to offer a proper 250cc motorcycle for reasons unexplained, never mind the duty-stricken (and hence super-expensive) Kawasaki Ninja 250R. However, it seems Honda has shown them how it’s done. Honda plans to sell around 30,000 units of the CBR250R in its first year — that should open the eyes and ears of its competitors, and it won’t be long before we see similar products rolling off their assembly lines. When it was announced, the CBR250R looked set to be a milestone in Indian motorcycling and after riding it, we think it has already become one.
Makes you wonder why they called it the CBR then, doesn’t it? Well, it’s probably because buyers in this segment probably aspire to Honda’s flagship CBRs, so having the same aura envelop this 250cc motorcycle is a good selling point.
The CBR250R is a well-proportioned motorcycle. It is also bigger than the 220-odd cc motorcycles that we’ve seen in India for some time now. This motorcycle’s face is what grabs people’s attention, while the rest of the bike succeeds in holding that attention, judging by the reactions we got while riding it. It looks sophisticated and fast, while the chunky rubber gives it a planted stance. The instrument console has a digital speedometer, a tachometer and a trip meter along with a clock, a fuel gauge and a coolant temperature indicator. The exhaust is a substantial upswept unit that adds to the sporty look. Overall, it’s quite the looker. The level of quality is top notch too, as expected from a premium Honda.
PERFORMANCE
This is where the fun begins! The CBR250R comes with a 249.6cc four-stroke motor that uses a four-valve head and liquid-cooling to produce 25 bhp@8,500 rpm and 2.33 kgm@7,000 rpm. These numbers are enough to propel the 167 kg CBR to 100 kmph in around 9 seconds, while top speed is in excess of 150 kmph — that’s shattering performance for a 250, really! The lower three gears have enough grunt to keep the rider grinning, while the top three gears continue building the superb acceleration into sensational top speed.
What’s more important is how the motor feels while it’s out on the road — smooth and fast. The six-speed gearbox has well spaced-out ratios that are on the taller side, so you get an excellent highway steed that possesses great in-gear acceleration to overtake any kind of traffic one might encounter. However, the flip side is that in the city, it is not very easy to put it in a higher gear and trundle around; you need to keep working the gearbox. However, all said and done, the CBR250R goes as well as it looks.
Engine efficiency, given the performance and the way we’ve ridden it, is surprising. Out on the highway, cruising in top gear between 5,000 and 8,000 rpm, we got a figure of 45 kmpl. In the city, it drops to 39 kmpl, though it’s not a bad number by any stretch for a bike like this.
RIDE AND HANDLING
The CBR250R’s sporty riding position is excellent — not too upright but not back-breaking either. You feel at home in traffic as well as out on the open roads. The seat, however, could be less firm and makes you thank the CBR’s ride quality, which is great. One cannot term it as plush, but it certainly absorbs everything without unsettling the bike. Going around corners is a comfortable experience, though handling response is not exactly razor sharp, thanks to the fat rear tyre and the bike’s considerable mass. However, even though it feels a bit too soft, everything remains predictable enough for you to enjoy any road that you might chance upon. The best part is the brakes, especially the optional Combined Anti-lock Braking System (C-ABS) package, with which you get strong braking power via the 296 mm front disc. You only have to squeeze the front lever and the CBR simply stops without any sign of getting out of shape
WHAT YOU GET
An accomplished motorcycle that’s fantastic value for money. By pricing the CBR250R at Rs 1.51 lakh for the base model and Rs 1.71 lakh (ex-showroom, Mumbai) for the C-ABS version, Honda has dealt a serious blow to nearly everything in the premium motorcycle segment.
To be honest, the CBR is more than just a brilliant motorcycle. It’s a wake-up call for every other manufacturer who has ignored Indian motorcycling enthusiasts’ pleas for a well-engineered and fast motorcycle that’s also value for money. By deciding to make it here in India, Honda has again shown faith in the Indian motorcycling market and stolen a march on its rivals at the same time. Reward then, is assured.
Two-wheeler makers bullish on smaller towns
Quite unlike carmakers, two-wheeler companies are bullish on growth this fiscal, with overall numbers expected to be in the range of 15 million units — a 20 per cent jump from 2010-11.
Hero Honda and Bajaj Auto would together account for a lion's share of this output with around 10 million bikes and scooters. TVS Motor Company and Honda Motorcycle & Scooter will take up a little over 4.5 million units, with Mahindra & Mahindra, Suzuki and Yamaha bringing the net tally to 15 million units.
Top Four
The Top Four reported sales of over nearly 1.2 million two-wheelers in April, and indications are that the brisk trend will continue in the coming months while peaking during the festive season.
There is a lot of buying happening in smaller towns and companies are going flat out to woo new buyers. Also, with petrol prices set to see another hike in the coming weeks, mileage will be the top priority on everyone's minds and here is where commuter bikes will see sales shoot through the roof.
This fiscal is also expected to see sharper growth in sales of gearless scooters, and sources say monthly numbers could eventually reach two lakh units. HMSI is the market leader with the Activa with TVS Motor in second place with the Scooty and Wego. Hero Honda's Pleasure has been doing good business, while M&M and Suzuki will look for bigger growth this year.
“Gearless scooters are the best bet for the working woman and go beyond the big cities. The coming months will see demand grow from a host of smaller towns and villages where commuting is paramount. Women prefer the safety and privacy of their scooters to travelling in a bus,” sources said.
It is not as if men shun these products either because the Activa, for instance, has a substantial share of male customers. As an official said, “Gone are the days when gearless scooters were associated with pansies. Men no longer have such hang-ups and realise that they are the best bet in crowded traffic.”
Tug-of-war
Industry will, doubtless, be monitoring the keen tug-of-war between rival companies. If the April numbers are anything to go by, Hero Honda will reign supreme with annual sales projected to touch six million units. The Splendor brand continues to be a huge draw in the commuter segment, and the Munjals will be keen to prove a point that they are capable of holding their own sans Honda.
In its turn, the Japanese company has already made public its intent to go flat out in the coming years to regain leadership position. For the moment, its wholly-owned arm, HMSI, has targeted 2.2 million units for this fiscal, but could double this tally by 2014-15.
HMSI will also have to contend with TVS Motor which has been working quietly on consolidating its numbers. Its sales touched the two million mark in 2010-11, and the company would be looking at a higher growth curve this fiscal, especially with its scooters doing well.
New models
Bajaj Auto has already indicated that it is targeting a 20 per cent growth this fiscal, which means it would like to end with over four million motorcycles. The Discover has been the best piece of news from the viewpoint of growing its presence in the commuter category dominated by Hero Honda. This year will also see Bajaj bring out a new range of Pulsar and Discover bikes which promise to be more stylish and powerful.
Hero Honda and Bajaj Auto would together account for a lion's share of this output with around 10 million bikes and scooters. TVS Motor Company and Honda Motorcycle & Scooter will take up a little over 4.5 million units, with Mahindra & Mahindra, Suzuki and Yamaha bringing the net tally to 15 million units.
Top Four
The Top Four reported sales of over nearly 1.2 million two-wheelers in April, and indications are that the brisk trend will continue in the coming months while peaking during the festive season.
There is a lot of buying happening in smaller towns and companies are going flat out to woo new buyers. Also, with petrol prices set to see another hike in the coming weeks, mileage will be the top priority on everyone's minds and here is where commuter bikes will see sales shoot through the roof.
This fiscal is also expected to see sharper growth in sales of gearless scooters, and sources say monthly numbers could eventually reach two lakh units. HMSI is the market leader with the Activa with TVS Motor in second place with the Scooty and Wego. Hero Honda's Pleasure has been doing good business, while M&M and Suzuki will look for bigger growth this year.
“Gearless scooters are the best bet for the working woman and go beyond the big cities. The coming months will see demand grow from a host of smaller towns and villages where commuting is paramount. Women prefer the safety and privacy of their scooters to travelling in a bus,” sources said.
It is not as if men shun these products either because the Activa, for instance, has a substantial share of male customers. As an official said, “Gone are the days when gearless scooters were associated with pansies. Men no longer have such hang-ups and realise that they are the best bet in crowded traffic.”
Tug-of-war
Industry will, doubtless, be monitoring the keen tug-of-war between rival companies. If the April numbers are anything to go by, Hero Honda will reign supreme with annual sales projected to touch six million units. The Splendor brand continues to be a huge draw in the commuter segment, and the Munjals will be keen to prove a point that they are capable of holding their own sans Honda.
In its turn, the Japanese company has already made public its intent to go flat out in the coming years to regain leadership position. For the moment, its wholly-owned arm, HMSI, has targeted 2.2 million units for this fiscal, but could double this tally by 2014-15.
HMSI will also have to contend with TVS Motor which has been working quietly on consolidating its numbers. Its sales touched the two million mark in 2010-11, and the company would be looking at a higher growth curve this fiscal, especially with its scooters doing well.
New models
Bajaj Auto has already indicated that it is targeting a 20 per cent growth this fiscal, which means it would like to end with over four million motorcycles. The Discover has been the best piece of news from the viewpoint of growing its presence in the commuter category dominated by Hero Honda. This year will also see Bajaj bring out a new range of Pulsar and Discover bikes which promise to be more stylish and powerful.
SIAM Reclassifies Segments For Reporting Sales Data
The Society of Indian Automobile Manufacturers (SIAM) has come up with a revised format in accordance with which sales data of automobile manufacturers will be reported from this month.
Senior director Sugato Sen said, “The existing format was put in place in 2002. Since then, the automobile industry has undergone a major transformation. There are more cars available on Wednesday, due to which we felt the need to increase segmentation and provide more detailed data.”
The passenger vehicle (PV) segment would now have nine categories with cars being reclassified according to their length, price and engine capacity. Earlier, the segment had models classified under six sub-segments. The new category — the micro — sub-segment has Tata Nano as the sole contender. The two additional sub-segments are the super compact category which would include cars with length between 4,000 mm and 4,250 mm and the coupe, which would cover 2-4 door roadsters with firm or retractable roofs.
Utility vehicles (UVs), which were earlier classified into two sub-segments on the basis of the number of seats and mass, have now been re-grouped into five sub-segments depending on the length and price. The first three segments — UV1, UV2 and UV3 — would have products priced up to Rs 15 lakh. While the UV4 sub-segment would group products tagged between Rs 15 and Rs 25 lakh, UV5 would report sales of products priced above Rs 25 lakh.
Multi-purpose vehicles would now be classified into two groups — V1 vans with hard tops used for personal transport and V2, which would include vans with soft tops used as maxi cabs.
The medium and heavy commercial vehicles would continue to have three and five sub-segments for carriers used for passenger transportation and goods transportation purposes, respectively. No changes have been made in the manner in which sales data for two-wheelers and three-wheelers is reported.
Sen said passenger vehicles such as the Tata Winger, which were earlier categorised in the PV segment, would now be considered in the light commercial vehicle (LCV, passenger) one. “This would be the re-arrangement as far as volumes are concerned. We would be re-adjusting the data for last year to make figures comparable.”
LCV used for passenger transportation would have two sub-segments while those used for carrying goods would have four sub-segments.
Sen said the industry body has held discussions with members and they would release model-wise sales numbers, possibly from this month onwards. The data would be disclosed a week after the monthly report is released by SIAM.
Senior director Sugato Sen said, “The existing format was put in place in 2002. Since then, the automobile industry has undergone a major transformation. There are more cars available on Wednesday, due to which we felt the need to increase segmentation and provide more detailed data.”
The passenger vehicle (PV) segment would now have nine categories with cars being reclassified according to their length, price and engine capacity. Earlier, the segment had models classified under six sub-segments. The new category — the micro — sub-segment has Tata Nano as the sole contender. The two additional sub-segments are the super compact category which would include cars with length between 4,000 mm and 4,250 mm and the coupe, which would cover 2-4 door roadsters with firm or retractable roofs.
Utility vehicles (UVs), which were earlier classified into two sub-segments on the basis of the number of seats and mass, have now been re-grouped into five sub-segments depending on the length and price. The first three segments — UV1, UV2 and UV3 — would have products priced up to Rs 15 lakh. While the UV4 sub-segment would group products tagged between Rs 15 and Rs 25 lakh, UV5 would report sales of products priced above Rs 25 lakh.
Multi-purpose vehicles would now be classified into two groups — V1 vans with hard tops used for personal transport and V2, which would include vans with soft tops used as maxi cabs.
The medium and heavy commercial vehicles would continue to have three and five sub-segments for carriers used for passenger transportation and goods transportation purposes, respectively. No changes have been made in the manner in which sales data for two-wheelers and three-wheelers is reported.
Sen said passenger vehicles such as the Tata Winger, which were earlier categorised in the PV segment, would now be considered in the light commercial vehicle (LCV, passenger) one. “This would be the re-arrangement as far as volumes are concerned. We would be re-adjusting the data for last year to make figures comparable.”
LCV used for passenger transportation would have two sub-segments while those used for carrying goods would have four sub-segments.
Sen said the industry body has held discussions with members and they would release model-wise sales numbers, possibly from this month onwards. The data would be disclosed a week after the monthly report is released by SIAM.
Hero may use Honda’s current technology for future models
Hero Honda may utilise erstwhile promoter Honda’s technology used in its current models for developing future products.
After deciding to part ways on their 26-year-old joint venture, the Hero Group and Honda signed a new licensing agreement under which the Indian firm will pay its Japanese counterpart 45 billion yen (about Rs 2,450 crore) till 2014.
“We have the right to use the (Honda) technology in perpetuity for the existing models as part of the arrangement,” said Mr Ravi Sud, Chief Financial Officer, Hero Honda Motors Ltd.
Under the agreement, Hero Honda is free to modify or use the platforms of all the existing products, including Splendor, Passion, CBZ to develop new models, he said.
“Earlier, we had to take Honda’s permission to make a change even on the design graphics but now we can change the engine or gearbox or develop on the platforms, if we wish, on our own,” Mr Sud said.
Asked if Hero Honda will use the existing technology for developing future products, he said: “Well, we have the rights and we would like to use it“.
Apart from considering using Honda’s technology, the company is also building up its own R&D capabilities, both manpower and logistics.
The company has earmarked up to Rs 800 crore as capital expenditure for 2011—12 financial year, mainly for setting up its fourth plant and also for R&D activities.
After deciding to part ways on their 26-year-old joint venture, the Hero Group and Honda signed a new licensing agreement under which the Indian firm will pay its Japanese counterpart 45 billion yen (about Rs 2,450 crore) till 2014.
“We have the right to use the (Honda) technology in perpetuity for the existing models as part of the arrangement,” said Mr Ravi Sud, Chief Financial Officer, Hero Honda Motors Ltd.
Under the agreement, Hero Honda is free to modify or use the platforms of all the existing products, including Splendor, Passion, CBZ to develop new models, he said.
“Earlier, we had to take Honda’s permission to make a change even on the design graphics but now we can change the engine or gearbox or develop on the platforms, if we wish, on our own,” Mr Sud said.
Asked if Hero Honda will use the existing technology for developing future products, he said: “Well, we have the rights and we would like to use it“.
Apart from considering using Honda’s technology, the company is also building up its own R&D capabilities, both manpower and logistics.
The company has earmarked up to Rs 800 crore as capital expenditure for 2011—12 financial year, mainly for setting up its fourth plant and also for R&D activities.