Pressure is mounting on Honda Motorcycle and Scooters India to resume normal supplies of scooters and motorcycles to its dealers who are forced to ask customers to wait for up to four to five months for delivery.
The company has had a long pay dispute with labor unions which has heavily affected production for the past month at its plant in Manesar. Monthly production has dropped to about 55,000 units from the usual 110,000 units. The dispute is yet to be resolved.
A customer of the Activa 110 a top selling ungeared scooter brand from HMSI will only be able to ride on his purchase by February or even March if the booking is made now. The company was in the process of jacking up capacity for the model which it launched towards the end of March this year, when it was hit by the labor trouble.
A city based dealer of Honda in the suburban area said that “As the supply itself from the company is down drastically, we are forced to ask customers to wait for a maximum of four to five months for the Activa. Even other models such as Unicorn carry a waiting period of two-three months, while a buyer of the CBF Stunner will have to wait a bit longer.”
Officials at HMSI appear uncertain on reaching an early settlement with their workforce. A senior executive from the company said that “We are constantly in dialogue with the workers but do not know how long it will take for the matter to get completely resolved. Production has been hit badly and it’s not only Honda getting affected but every company attached to it is hit, including our suppliers.”
Agitating workers are demanding more pay, including an increase in the fixed portion of the salary structure, apart from other incentives. HMSI officials say this is unacceptable.
The loss in supply of HMSI models in the market has resulted in demand moving in favour of those from competing companies like Suzuki Motorcycle India and Mahindra Two Wheelers for the scooter range and Bajaj Auto, Hero Honda and Yamaha for the motorcycle range.
A dealer from Mahindra Two Wheelers said that “There has been an increase of 10% to 20% in demand for our models, especially the Rodeo over the past two to three weeks. We have got ready delivery of our products, whereas Honda dealers are asking customers to wait for five months.”
