As part of its future growth plans, Hero MotoCorp is preparing to expand its range of electric two-wheelers while upgrading its existing sales infrastructure to strengthen its premium business, according to Hero MotoCorp’s newly appointed CEO Niranjan Gupta. Outlining the company’s three medium-term priorities, he noted that it will focus on strengthening its presence in the premium market, expanding the commuter market and achieving leadership in the electric two-wheeler market.
“The way we move forward in these three areas, speed will be the name of the game,” Gupta, who was promoted to CEO on May 1, said in an interaction here.
He served as the company’s chief financial officer before taking over as CEO.
In the field of electric two-wheelers, the company plans to launch new entry-level models to cater to a wider customer base.
“By the end of March, we’re actually going to 100 cities … so by March, it’s going to be about 100 cities, and then over the next four quarters, we’re going to have a product in the mid-range and electric skateboards The bottom of the car,” Gupta noted in the interaction here.
For now, with the VIDA V1 series, the company will be positioned at the high end, which is a conscious strategic move, he said.
Gupta added that with the brand established, it was time to expand the product range.
Responding to a query, he noted that the electric vehicle startup space has become very crowded and that there will be consolidation in the space given changes in regulations (subsidies under the FAME scheme have fallen).
“We believe there will be consolidation … and when it happens, it will shrink to fewer players,” Gupta said.
He added that the company is well positioned to move forward with its various collaborations and product initiatives amid the expected market consolidation.
Apart from targeting leadership in the electric two-wheeler segment, the company also plans to strengthen its presence in the premium segment (160-450 cc), Gupta said.
He noted that this year will see the greatest number of launches of all new premium products than any other year in the company’s history.
“We’re doing two things. One, we’re going to be upgrading some of our current stores to what we call Hero 2.0, which is going to be a retrofit of existing stores, so that’s going to include both the hardware and the software part and this part of the current store,” the CEO said.
The second element of brick-and-mortar stores is opening some specialty stores to accommodate high-end models.
Gupta said the company plans to upgrade 35-40% of its 1,000 key dealerships in stages.
“So the combination of the two will ensure that with digital … we offer buyers a different level of retail experience,” he added.
Hero MotoCorp will focus on the entire high-end range, from 160 to 450 cc, he said.
The company will also focus on expanding the commuter bike market (100-125 cc).
Overall growth in the vertical will ultimately help the company as it leads the segment with a 65-70% market share.
Gupta also highlighted putting “disproportionate” resources into 8-10 international markets, putting them on the fast track.
“We’re in 40+ markets… What we’re going to do is double down on the big 8-10 of those markets and put resources there disproportionately so that we can get those markets on a faster trajectory while The same goes for catering to other markets,” he noted.
He added that the company will focus on markets such as Mexico, Nigeria, Bangladesh and Colombia.
“So in 8-10 of those markets, we’re going to double down,” Gupta said.
The company currently generates just 5% of its revenue from its global operations.
First published date: June 8, 2023 at 10:36 AM CST
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