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Narrator: With the full settlement made, the famous Hero and Honda relationship came to an end.

On
this event, lets have a look at the sage of India’s most successful JV.

The story dates back to 1983….

Hero: (1st Scene)

Hero MD: India is developing and in future there is going to huge demand for motor vehicles. I want
Hero to be the market leader in the motor cycle segment. We should start preparations from now itself
for achieving growth in future. What to do need to achieve this objective?

Hero Manager: Sir, we need to invest in R&D and develop high class product and high end production
facilities to become the market leader.

Hero MD: But do we have that expertise and experience to set up such facilities?

Hero Manager: No Sir.

Hero MD: Ok. Explore what can be done for this and get back to me ASAP.

Honda: (2nd Scene)

Honda MD: We are exploring foreign markets for business expansion and India can promise a great
future potential. How can we taper this market?

Honda Manager: Sir, but Indian market is a highly closed economy and it doesn’t allow foreign
companies to enter that easily.

Honda MD: Ok. Explore what can be done for this and get back to me ASAP.

Hero: (3rd Scene)

Hero Manager: Sir, Honda company is looking to enter Indian Market, but regulations won’t allow a
foreign player to enter, they have to form a partnership with some Indian entity. We can partner with
them and can get access to their high end technology to achieve our objective.

Hero MD: Ohh, it’s a good news. Arrange a meeting with honda officials to explore opportunities.

Honda: (4th Scene)

Honda: Sir, regulations won’t allow any foreign player enter Indian markets independently. We need to
partner with some Indian companies to access Indian markets. Hero company is interested in partnering
with us. We can use their distribution channels and achieve our objective.

Honda MD: Okay. Arrange a meeting with them.


Narator: In 1984……

Hero-Honda successfully formed a joint venture.

By this Honda will provide Hero access to its technological expertise. Hero will produce products and will
market them as Hero-Honda products.

Hero-Honda products are to be sold only in countries of India, Sri Lanka, Nepal & Bangladesh.

Hero-Honda Ltd. Produced most successful products like CD-100, CD-Dawn, Splendor, Splendor + etc.

In 1992 – India adopts LPG policy.

1999 – Honda establishes their own production facility.

Hero (5th Scene)

Hero MD: Sir, you started your own facilities and our products are facing competition from them.

Honda MD: Indian markets are expanding, and we want to catch up the pace. There is enough scope for
all the players to achieve growth.

(will be said the narrator) Hero MD (To himself): Honda want to achieve their own targets. They may
soon ignore the joint venture and we will be lost. We should start developing our own capabilities.

Narrator:

2011: By now Honda established 3 independent production facilities.

2011: It seems the time to part our ways. Till now it has been a very successful venture and produced
many popular brands, achieving high profits.

The dilution of Hero Honda Venture started in 2011 and completed in 2017. Now Hero and Honda
operate as independent entities. Hero can expand its products to countries other than India, Sri Lanka,
Nepal and Bangladesh. Honda can now sell its own products in Indian markets.