New Delhi: The country's largest two-wheeler maker Hero MotoCorp Ltd on Wednesday said it has entered into technology sourcing pact with US-based Erik Buell Racing as it looks to strengthen presence in the high-end bike segment.
The development is a part of the Indian firm's strategy to enhance technological prowess, post the breakup of the erstwhile joint venture with Honda -- Hero Honda.
"We are entering into a strategic partnership with Erik Buell Racing (EBR), which currently is more into high end and high performance racing bikes as we are completely missing in this category of motorcycles," Hero MotoCorp Ltd Managing Director and Chief Executive Officer Pawan Munjal told.
He said the partnership is not a joint venture but is "a long-term arrangement".
While EBR is more into high end, Munjal said it is also possible that the US firm's technology can also be used for smaller engine bikes.
Asked by when Hero MotoCorp Ltd (HMCL) could launch a product using EBR technology in the market, he said: "We have already started work on some of our existing products and also on completely new product. I would tend to say that by calendar 2013 (a product will be launched)."
He, however, said that the company will not straightaway launch a 1,000 cc or a 1,200 cc bike using the EBR technology but would move up gradually.
The product will cater to global markets and the two partners have not yet finalised if HMCL would be restricted to enter markets where EBR is present or not, Munjal added.
"Those are things we will address as we go forward but in terms of market we are not restricting ourselves," he said.
Munjal said the idea behind entering into partnership with EBR is a part of HMCL's overall strategy to have multiple technology source for different segments and enhance its own R&D capability.
"As stated in the past that we will not replace the current technology (Honda's) with just one technology source or technology company or partnership but we are looking at multiple technology tie ups to go for specialised technologies wherever available," he said.
"Ultimately the idea is to build our own R&D capabilities to match the best in the world," Munjal added.
In December 2010, the Hero Group and Honda had agreed to end their 26-year-old relationship, with the Indian partner agreeing to buy out Honda's 26 per cent stake in Hero Honda for Rs 3,841.83 crore.
The two partners had, however, signed a new licensing agreement under which Hero will pay Honda 45 billion yen (about Rs 2,450 crore) till 2014.
Munjal said HCML is already in discussions with other firms for sourcing of technology for commuter bikes to replace the Honda technology.
"The work is already on...It could happen even before that (2014) and we don't have to wait for the end of the deadline," he said.