Japanese automaker Honda plans to invest around ₹920 crore to set up a fourth production line at its fourth plant in Ahmedabad, Gujarat, as it looks to catch up with its erstwhile Indian partner Hero MotoCorp.

Honda Motorcycle & Scooter India Pvt Ltd (HMSI), Honda’s local subsidiary, will build a fourth production line at Vithalapur, Ahmedabad. The line is expected to begin operations in 2027.

The new line will have an annual production capacity of 650,000 units, bringing the total capacity of the fourth plant to 2.61 million units, making it Honda’s largest assembly plant for Honda motorcycles in the world. The Japanese automaker said the new line will bring 1,800 new jobs.

HMSI currently has four production plants in India with a total annual production capacity of 6.14 million units.

The capacity addition comes at a time when Honda is looking to topple its former Indian partner Hero in terms of volumes. In January, Honda said it has steadily increased sales volume in two-wheelers to the point where the largest market share in India is within reach. Honda also plans to capture the largest market share in the nascent electric motorcycle market in India.

Hero MotoCorp is India’s largest two-wheeler maker with around 29% market share in FY25, according to data released by the Federation of Automobile Dealers Associations (FADA). Honda’s market share was a little over 25% in FY25. About 60% of Honda’s sales in India come from scooters and the rest 40% from motorcycles. For Hero, which parted ways with Honda in 2011, motorcycles account for over 90% of its total sales.

Honda's fourth plant started operation in February 2016 with an annual production capacity of 600,000 units, and in June of the same year, the company expanded its capacity to 1.2 million units with the start of its second line. Furthermore, the third line started operation in January 2024, taking annual production capacity to 1.96 million units.

But Honda is ramping up its motorcycle play. Honda will invest around ₹920 crore to construct a fourth line capable of producing 650,000 units of 125cc class motorcycles per year on the premises of the fourth plant. With the addition of the fourth production line at the fourth plant, HMSI’s total annual production capacity is expected to increase from the current 6.14 million units to approximately 7 million units by 2027 through further expansion of production capacity planned for other plants in India.

Honda's cumulative production volume reached 70 million units in April of this year, after 25 years since the start of production in 2001.

“Honda has long been investing and expanding its production capacity in India, the world’s largest motorcycle market, to bring joy to its customers. 25 years on, with much support, HMSI has reached the milestone of 70 million units of cumulative production. With the additional investment in our fourth plant, Honda will continue to deliver attractive products and services to its customers around the world who have higher expectations and trust in the company, and further solidify its Indian motorcycle business,” said Tsutsumu Otani, President and CEO, HMSI.