Honda Motor Co plans to expand its share of Indonesia’s big motorcycle market to 60% from 46% before the decade is up by increasing its edge over arch-rival Yamaha Motor, the chief of its Indonesian venture said, Economic Times reported.
Honda, the world’s top motorcycle maker, increased its annual output capacity in Indonesia to 4.3 million vehicles in July from 3.5 million at the end of last year, scrambling to keep pace with surging demand.
Indonesia is the world’s third biggest two-wheeler market, having grown by about 40% in the past five years to 7.355 million in 2010 on the back of steady economic expansion and rising income in a country with virtually no public transport system. Of that, Honda shipped 3.416 million, giving it a market share just 1.2% more than Yamaha.
“We expect demand to continue growing, and reach 10 million within the decade,” Yusuke Hori, president director of PT Astra Honda Motor said. “By then, we want to own 60% of the market.The kind of growth would require more production facilities less than two years down the line," Hori said.
With full overtime usage, Honda would be able to build at least 5 million motorcycles a year with what it has now, he said.
For 2011, Honda is aiming for a 53% share of the market with sales of 4.3 million motorcycles out of an expected 8.10 million market, Hori said.
Honda had lagged Yamaha in launching automatic transmission models in Indonesia as that market grew from just 4% in 2005 to 45% last year, forcing it to cede its spot for several months at the start of 2010. That sent its Japanese headquarters into crisis mode, culminating in the appointment in April 2010 of Hori to head Astra Honda, the 50-50 joint venture with the local conglomerate Astra International. “The first thing I did was visit 90 dealers in 12 major cities over three months, Hori said. "The decision to add more capacity came quickly, after one month of being here, because I knew that was the main reason we had fallen behind."
Honda Motor Company is a Japanese public multinational corporation engaged in manufacturing of automobiles and motorcycles.
