Hero Honda Motors has planned to expand its
motorcycle capacity by 7.4 per cent to cater to rising demand. Capacity would be
raised to 2.9 million units per year by May 2005 from 2.7 million units at
present. The expansion would cost Rs.80 crore.
The company has felt that rising urban incomes
and easier availability of loans in small cities is boosting demand for
motorcycles.