MUMBAI: Honda Motorcycle & Scooter India (HMSI) has announced plans to produce 1 lakh electric scooters in the first year of its electric vehicle (EV) venture. This marks the launch of two new models, the ACTIVA e: and QC1. These scooters, boasting up to 99% localisation, will be manufactured at Honda’s Narsapura plant near Bengaluru, Karnataka.
The bookings for the ACTIVA e: and QC1 will open on 1 January 2025, with deliveries commencing from February 2025. Initially, the ACTIVA e: will be available in Delhi, Mumbai, and Bengaluru, while the QC1 will launch in select cities. Honda plans to announce the pricing of these EVs in January 2025 after evaluating the booking response. The pricing will not factor in government subsidies.
As the last major two-wheeler manufacturer to enter the EV segment, HMSI aims to leverage the trusted Activa brand and Honda’s reputation to address challenges in the electric scooter market. Despite a growing EV market, HMSI anticipates moderate overall growth for the two-wheeler (2W) industry in 2025 due to rising prices linked to stricter emission norms, which come into effect on 1 April 2025.
“Owing to the shift from OBD-2A to OBD-2B norms, there will be a substantial price hike, which will impact demand. While we expect double-digit growth next year, it will be in the lower range,” said Yogesh Mathur, Director, Sales and Marketing, HMSI.
In the April–October 2024 period, HMSI recorded sales of over 34 lakh units, reflecting a 28.71% year-on-year growth. However, the company foresees challenges as the new norms affect consumer demand.
Honda’s EV entry coincides with significant growth in the electric two-wheeler market. According to data from the Federation of Automobile Dealers Associations (FADA), e-2W sales in October 2024 surged by 85% year-on-year to 1.39 lakh units, securing a 6.7% share of the total 2W market.
New-age firms like Ola Electric dominate the market, while HMSI’s ICE competitors, TVS Motor and Bajaj Auto, have already established strong positions in the EV segment, benefitting from hefty subsidies during their launches. However, with subsidy amounts now reduced, sales growth has moderated. To attract cost-sensitive customers, original equipment manufacturers (OEMs) are focusing on EVs with smaller battery packs.
“EV sales were growing at a very high pace 4–5 years ago, but the growth rate has moderated. Long-term, EV sales will rise. However, achieving carbon neutrality, which is our goal, requires a mix of technologies like hydrogen, biofuels, CNG, and EVs,” said Tsutsumu Otani, Managing Director, President & CEO, HMSI. He also noted that preferences for alternative fuels would vary across states based on availability and infrastructure.
Honda’s new EV models will primarily target urban consumers, with a focus on addressing demand in key cities during the initial launch phase. The company aims to expand its presence in the rapidly growing segment, which already accounts for over 6% of the total two-wheeler market.