Honda to Invest ₹2,420 Crore in Gujarat, Rajasthan to Expand Production Capacity

Ahmedabad: Honda Motorcycle & Scooter India (HMSI) is investing ₹2,420 crore to expand manufacturing capacity at its facilities in Gujarat and Rajasthan, a news report said.

According to a BusinessLine report, the company aims to increase its annual production capacity to 80 lakh vehicles by 2028 amid rising demand for conventional two-wheelers and growing competition in the electric and premium motorcycle segments.

The expansion will add 13.2 lakh units of annual manufacturing capacity as the Japanese two-wheeler manufacturer seeks to strengthen its dominance in the scooter and commuter motorcycle markets while expanding its presence in higher-capacity motorcycles and electric vehicles.

The investment comes three-and-a-half years after Tsutsumu Otani took charge of HMSI, during which the company’s annual dispatches increased nearly 46 per cent, from 43.51 lakh units in FY23 to approximately 63.7 lakh units in FY26.

Capacity expansion amid rising demand

Otani, president and CEO of HMSI, said the company was balancing capacity expansion with demand for internal combustion engine (ICE) and electric two-wheelers.

“ICE demand is also high, so we need to balance production based on customer demand,” he told the newspaper, adding that existing manufacturing capacity was fully utilised.

Describing festival-season demand as “very strong”, Otani said the industry had recorded growth in the first half of the financial year and expected motorcycle sales to continue expanding.

HMSI’s dispatches increased 15 per cent to 41.74 lakh units during April-October 2026. Domestic sales rose 13 per cent to 37.08 lakh units, while exports grew 28 per cent to 4.65 lakh units.

Vehicle registration data from Vahan showed Honda leading Hero MotoCorp in monthly registrations for four consecutive months through October, reducing Hero’s calendar-year lead to 93,803 units from 2.32 lakh units at the end of June.

However, Otani acknowledged that the recovery remained uneven, particularly in rural markets. DeshGujarat