A Family Settlement Agreement that happened in the Munjal family has landed Hero MotoCorp into a situation where it has been restricted from selling its electric scooters and bikes under one of the most trusted brand names – Hero. Formerly known as Hero Honda, it is the largest two-wheeler manufacturer, therefore, has an empire worth multi-billion dollars comprising of various business verticals. These verticals have now been divided between the family members that come under a family pact that was finalised in 2010.
As a result of the split, the company may have to drop the Hero brand name and come up with a new brand name for its electric two-wheelers that will shortly arrive in the market. This Family Settlement restricts Pawan Munjal, who is the chairman and promoter of Hero MotoCorp from using the brand name as the rights of it rest with Naveen Munjal who is the promoter and managing director of Hero Electric Vehicles Pvt. Ltd.
Not just Pawan Munjal, even other members of the Munjal family have been restricted from using the Hero brand name. Hero MotoCorp is in the process of manufacturing electric scooters but has not yet disclosed anything about the launch.
The company is looking forward to bringing new products that will be engineered according to the new technology but not under the brand name Hero. As per the recent reports, the company will not change its dealership to sell their electric products, even if it has to change its brand name.
Due to new and stricter rules, Hero Electric has experienced a dip in sales. These new laws ensure that the prices of eco-friendly vehicles should be low as these avail subsidiaries under the FAME Scheme. Although using a new brand name may prove to be an obstacle for the company, Hero MotoCorp feels that it is also a great opportunity for the launch of its electric two-wheelers as it will help in growing its customer base.