The Hindu Business Line : Honda Motorcycles production hit by labour unrest

New Delhi, Oct. 27 Honda Motorcycles and Scooters India (HMSI) said on Tuesday that it has a 1.4-lakh order backlog due to the continuing labour unrest at its Manesar plant.

However, with its third production line becoming operational, the company expects production to go up substantially.

“This morning we started the new production line and are hopeful that our daily production will now go up. There is a long waiting line at our dealers because of short supply, so we have stopped taking orders for some models,” said Mr Shinji Aoyama, President and CEO, HMSI.

With a majority of the 5,500 workers going on strike for around a month, production at the Manesar facility had slowed down to about 50 per cent. Moreover, the newly commissioned third production line had also come to a halt. The company has since been holding tripartite discussions with Government officials and the labour union on long-term settlement of wages.

“The discussions are almost over and it will take about five more days to get into full production. Currently, the output for the third line is 300-400 units a day, which should reach about 1,000 units a day in a few weeks,” said Mr N.K. Rattan, Head – Sales & Marketing, HMSI.

He added that the current daily production of all three lines adds up to 2,200 units, which is half the maximum installed capacity of 4,400 units.

New Scooter

HMSI launched a new version of the Aviator scooter, which priced between Rs 42,160 and Rs 47,160, is being sold at a premium of about Rs 2,900 over the previous model.

“We are launching this new product because we feel that we need an expansion of variety. We already have products for every market segment,” said Mr Rattan.

According to the company, the scooter is powered by a new 110 cc engine, which has increased its fuel efficiency by 15 per cent over the previous model. Besides all new styling, other features include a maintenance-free battery and the ‘Combi-brake’, which ensures that both brakes are simultaneously applied when the left lever is pressed.

The company plans to sell 10,000 units of the new scooter a month and expects to sell 1.1 lakh units over the fiscal.