Honda is one of the leading manufacturers of world class products including cars and two wheeler( In collaboration with Hero Group ) and is very popular in India too. Honda Motor Company being the second largest manufacturer carries enough potential to stand on its own and this could be one of the reasons why it is considering a split with the Hero Group.
Yes its true. The joint venture between the Munjals of the Hero Group and Honda Motor Company may come to an end since the latter is busy evaluating proposals for a deal effective enough to make Honda exit the venture.
The Munjals were the ones who made the proposal since Honda’s technology licensing agreement is to end by 2014 before which the company should find a way out. Currently the Hondas hold 26 percent stake in the Hero Honda venture while the Munjals 26.21 percent share comprises of individual stakes from several investment companies.
As per the sources last month Honda Motor official had flown to New Delhi to meet the Munjal and discuss the proposed deals and reinforcing the news was the statement given to Australia’s Sydney Morning Herald by Tatsuhiro Oyama, senior managing director, Honda Motor Company which said, “The (Munjal) family has its own intentions; we are considering them.”
So we guess the matter is quite transparent and the actual result will be in front of us in some time from now.