|Honda Establishes Korean Subsidiary for Motorcycle Sales|
|Tokyo, November 5, 2001 --- Honda Motor Co., Ltd. today announced that it has established Honda Motorcycle Korea Co., Ltd., a subsidiary for motorcycle wholesale and retail sales in Korea.
The new company, based in Seoul, will begin operations early next year by establishing a flagship store in Seoul. In 2003 the company will set up a dealer network covering major regions in Korea to begin wholesale sales. They will sell Honda brand motorcycles and offer high-quality after-sales services and a reliable supply of spare components and parts to assure customer satisfaction.
The new subsidiary has been established based on recent market trends. The motorcycle market in Korea has been dominated by small motorcycles with a displacement of less than 125cc that are used mostly for personal transportation and commercial purposes. Annual sales were a stable 300,000 units before a serious recession hit the economy in 1998. Last year, annual sales totaled 160,000 units, but sales of larger-displacement motorcycles are increasing, totaling 4,829 units in 2000, a 254% increase from the previous year.
In view of this trend, including demand for greater diversification of motorcycles focusing on more recreational appeal and for improved after-sales services, Honda decided to establish its new subsidiary.
Honda's business in Korea began with technical collaboration with Daelim Motor Co., Ltd. in 1981 to produce and sell motorcycles. It recorded sales of 120,000 units in 2000, becoming the top motorcycle brand in the country.
After the inauguration of the new subsidiary, Honda will continue production and sales of small motorcycles at Daelim under its technical collaboration agreement. Honda also has plans to enter the large motorcycle business for motorcycles with a displacement of over 125cc through the new subsidiary, thus extending the popularity of the Honda Brand.