Honda China recently announced its latest sales in May. Its end-vehicle sales in the Chinese market were 89,000 units, down nearly 30% from the same period last year, and down more than 30% for the third consecutive month. Honda, like Toyota and other Japanese cars, has lagged behind in the development of electric vehicles and faces tough competition ahead.

But Honda is doing well in another area. Honda, the world's largest motorcycle maker, is the king of the Chinese market, which is beginning a revival.

China's motorcycle market is enjoying a Renaissance

Unexpectedly, as China has become the world's largest car market, motorcycles have quietly made a comeback. The main reason is that China's middle class is growing rapidly. Motorcycles have strong cultural genes of freedom and passion, catering to the psychological needs of the middle class to emphasize individuality and self. Motorcycles are no longer a means of transportation, but become a symbol of life style and spiritual culture. On Douyin, more than 54 billion videos have been played on topics related to motorbikes.

According to China's Ministry of Public Security, 10.05 million motorcycles were newly registered in 2021, up 21.67 percent year on year; In the first quarter of this year, 2.71 million motorcycles were newly registered, up 33 percent year on year. In first - and second-tier cities, some popular motorcycles are hard to spot. Honda's Forsa 350, for example, can even wait a year for delivery.

In 2021, China's motorcycle production and sales recovered to 20 million units, the best level since 2014, according to the China Motorcycle Chamber of Commerce. China is the world's largest motorcycle market, with a motorcycle industry worth more than $20 billion in 2021, accounting for nearly 20% of the global motorcycle industry market size, according to Statista.

Honda is not alone in spotting an opportunity in this exploding market. Harley, a well-known American motorcycle brand, established a joint venture with China's Qianjiang Motorcycle in December 2021. Local Chinese auto companies have also become new competitors in the motorcycle market: In August 2021, Great Wall Motor entered the motorcycle field and built a motorcycle factory with an annual output of 10,000 units in Baoding, Hebei province. In June 2021, Liuzhou Wuling Automobile Industry Co., Ltd. motorcycle Division was established and announced its formal entry into the motorcycle market.

Honda's position in the field of gas-powered motorcycles stands out

But for Honda, no matter its old rivals in Europe and the United States, or local Chinese companies, its advantages are still very obvious.

First, Honda's century-old technology accumulation and patent barriers make it difficult for rivals to overcome. Some Chinese industry researchers are pessimistic that if the gap between domestic and Japanese cars can still be caught up, the gap between domestic and Japanese motorcycles is like a world apart, and may never be able to complete the catch up.

Honda, on the other hand, has always adopted a highly defensive technology policy in the Chinese market. In the Chinese market, Honda has three sales systems, one is the new book, five book two channel car sales system, the second is Honda Wing, the third is Honda Dream Wing. For cars with displacement below 200cc, Honda handed over production to joint venture factories in China, but most of the supporting companies were Japanese enterprises; Although the middle row products are also produced by the two joint venture plants, Honda controls the key technology. The electronic injection system, engine and even more precision parts are supplied by Honda, while the domestic joint venture plants are almost only responsible for assembly. Honda 500cc products with the highest technical content are imported by big trade shops. Even if they bear more tariffs, they do not have relations with China's supporting industry chain.

But since last year, Honda has undergone a sudden strategic shift. First, Honda's foray into expansion is aimed at the fastest-growing and most profitable mid-to-high-end markets. In 2021, Honda will introduce a number of medium-displacement models to China at one go, and launch a price war to significantly reduce the price to 30,000 to 40,000 yuan. Once launched, it will be hard to find a car in the market, forming a strong suppression of Chinese domestic cars. Second, Honda's medium-displacement models were produced in China, making it the first Japanese motorcycle brand with medium-displacement to be locally produced.

Analyzes believed that Honda has realized and cars, motorcycles, electric is the trend of The Times, Honda has announced a halt to the sale of 2040 motorcycle fuel, launched in 2024, electric motorcycle, Honda's accumulation of fuel on the motorcycle, if you don't play to their value, how many years, will become history.

It is expected that Honda will continue to strengthen its position in China's large - displacement motorcycle market. According to a report by Japanese media YOUNG MACHINE on June 25, Honda is developing a medium displacement four-cylinder model with an estimated displacement of around 500cc, and it is aimed at the Chinese market, and the price will continue to be amazing.

The future of electric motorcycles is uncertain

But it is doubtful that Honda will have the same status as gas-powered motorcycles in the future.

For one thing, Honda is significantly behind on electric motorcycles. Harley released its first electric motorcycle, LiveWire, back in 2019, and its second electric two-wheeled bike, LiveWire Del Mar, in May this year. In June, Germany BMW motorcycle's second mass-produced pure electric motorcycle -- all new BMW CE 04 completed its debut in China and opened presale; Chinese companies have started earlier, using electric motorcycles, which Honda doesn't plan to introduce until 2024, as an opportunity to turn things around.

Secondly, in terms of technology and industry, all electric vehicles are basically at the same starting line at present, and Chinese enterprises are more experienced in industrialization. For example, China's Duffin rides DC100 pure electric motorcycle, and the range of the full vehicle has reached 400 kilometers.

Honda's future is by no means secure.