International Strategic Alliance

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The Joint venture between Honda Motors - Japan and Hero group made it a real “Hero” of two-wheeler industry and made Hero-Honda Motors the world’s largest two-wheeler company. When the joint venture agreement between Hero group and Honda Motors Company – Japan came up for revalidation in the year 2004, Honda Motors and Scooters India Ltd announced to enter the motorcycle market. This brought the management of Hero group to re-think their strategy. In order to overcome the emerging challenges, the management thought it appropriate to forge strategic partnering with a firm that brings to the group a technology that is futuristic, eco-friendly and has a promising future. Hero group launched its first electric vehicle in collaboration with Ultra Motors of UK in the middle of 2007 and achieved a landmark sale of 10000 electric bikes within 4 months of its launch. The case attempts to unfold the importance and relevance of cooperative strategies in Indian automobile industry especially two-wheeler industry and unveils the strategic actions initiated by the Hero group to uphold its leadership position in two-wheeler industry with the help of strategic alliance.

“India is an important market for us and offers an opportunity in Electric two wheelers. We have found a valuable partner in Hero Group in creating this new opportunity and tapping its potential. Efficiencies of both the companies in marketing and manufacturing respectively, proved to be a strong catalyst for sales and achieving the magic figure of 10,000 units. We will continue to innovate and grow with our current and future customers.” Commented Mr. Ian Woodcock, Chairman, Ultra Motors Company, a technology partner of Hero group – world’s largest manufacturer of two-wheeler on the occasion of celebrating the landmark sales of 10,000 units of electric two-wheelers in India in November 2007 1.

Hero Cycles Limited had earlier in October 2006, signed a Technical Collaboration-cum-Joint Marketing Agreement with...
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