Honda to Cut Motorcycle Prices

Honda plans to cut motorcycle prices by 10-30% in Japan due to sales in Japan over a 3 year period. Parts are going to be outsourced and development is going to be cut down.

Honda has almost half of japan sales so it should effect the other three. I wonder what's going to happen over here?

Will the European makers become increasingly exotic? I assume the competition and reliability of bikes now hurts sales.

The Yomiuri Shimbun

Honda Motor Co. plans to slash the prices of all the motorcycles it sells domestically to 2000 levels, the company has announced.

In an effort to halt young people's growing disinterest in motorcycles, Honda will cut the prices of about 45 models over three years, when each undergoes a full or minor model change

Prices are likely to fall by 10 percent to 30 percent, the company said Saturday.

The price of the least-expensive model of Honda's Super Cub 50 (50cc displacement), for example, will be cut by about 40,000 yen and the least-expensive Forza (250cc) will be lowered by about 120,000 yen.

Super Cub 50 is known as Honda's mainstay motorcycle, while Forza is a strong seller among midsize scooters.

To cut prices, Honda plans to increase the number of models produced in other Asian nations where personnel expenses and production costs are low, and use more inexpensive parts produced overseas.

Honda also plans to cut development expenses by reducing the time to develop a new model from the current two years to between one and 1-1/2 years.

The price-cutting strategy by Honda--an industry leader with a domestic market share of about 48 percent--is likely to affect other motorcycle companies, which are reeling from slow sales, observers said.

Motorcycles are popular in emerging nations, including India and Thailand, but domestic sales remain sluggish due to economic stagnation and insufficient parking facilities in urban areas.

Domestic motorcycle sales decreased by 27.1 percent in 2009 from the previous year to 380,777, plunging to only about one-tenth of peak sales of about 3.29 million in 1982.
(Jul. 5, 2010)