Pawan Munjal: I feel very good about it. It is a culmination of a dream that I have had for a long time now to put up a facility like this in India. This is probably amongst the best few facilities for innovation, technology and R&D across the globe, not just in Asia, not just in India but across the globe. This is an integrated central where we have everything to be able to come up with new products right from concept, design, prototyping, testing of parts, producing parts here, putting together prototype vehicles and then taking them out on the test tracks to test them in all 45 different kind of services from across the globe and 16 km long of test tracks here, now we do not have to go out for anything now.
ET Now: What kind of more impressive two wheelers will we see from Hero Moto stable in the coming few years?
Pawan Munjal: Early February, at the auto expo we had shown our intent, the direction where we are heading. In September-October last year, we introduced the first two indigenous Hero designed scooters, the Maestro Edge and the Duet. Both doing beautifully well. At the Auto Expo, we showed the Splendour Ismart 110, a completely new engine, new frame, new bike and we have shown also in the premium segment what we are likely to do to 200 cc, 250 cc bikes. Going beyond that, we have shown a concept in engine bigger than 250cc. So that clearly is a direction we are heading towards.
ET Now: Can you throw some light on how much investment has gone into this R&D centre? How much saving over the next few years will you have because earlier you were paying royalty to Honda. Now, what kind of savings will you have on your two wheelers and what have you invested so far in the R&D centre?
Pawan Munjal: The investment in the centre is about Rs 850 crore. We have already stopped paying royalty on most of our products to our erstwhile partners. There are very few products that we still pay royalty on, not a huge amount though. But more than the savings, what we can do ourselves in the centre is much more than what we could earlier buy from the partner. It is for us to decide what kind of product we want to do here at the center. We have the freedom and choice to be able to go into various segments, that the leadership team decides or the product strategy, product planning, people decide so there will be immense opportunities available to us here at the centre.
ET Now: Are you still in talks with some companies to get better R&D anywhere in the world?
Pawan Munjal: We have just started out at the centre and we have got so much to do with our current product range. The volumes that we do today and going forward the volumes that we would like to do in the future. We have a huge range that always needs to be upgraded and we have to grow some new models there and all that requires a lot of work which is currently going on at this centre now. We are going into new markets. We need different segments to go into those new markets. We will keep looking out and whenever we find an opportunity and a good company, that we can work with or acquire, we are open to inorganic growth as well.
ET Now: Where do you see the two-wheeler sales growing from here?
Pawan Munjal: So far, there is no indication that the market is going to change from where it was. It is not in a very healthy condition, but thankfully the budget has clearly put a lot of focus on the rural sector. Going forward, I am hoping that things would change in the rural sector. People would start spending money and consumption will start in the rural sector which really help Hero.