Honda’s `Stunning’ CBF125

Travel for Everyman

Intermot has seen one of the most crucial Honda launches of recent years; the new CBF125 commuter machine.

Not impressed? Maybe, but this basic no-frills bike, with its disc brake, half fairing and sturdy 11bhp single-cylinder motor is a modern day successor to the C90 Cub. It is also set to make Honda an absolute fortune in the EU market.

Why? Simple really, a basic bike like this, even though it features fuel injection and modern lights, brake etc costs very little to make when major components are sourced in China and India, plus assembly in CKD form takes place at Honda facilities near to, or just inside, the EU trade zone. Basically you make sure low-wage workers assemble 90% of a low budget bike and then a spend slightly more on Western economy marketing/logistics support to sell it across Europe.

in India this bike is being launched as the `Stunner’ and retails for around 51,400 rupees, or just under £800 sterling. You can bet it won’t cost that in the UK, in fact the French price is 2200 Euros. If Honda can sell it for half that Euros RRP in India, and make a profit, then what margin do they have on all EU zone CBF125 sales in 2009?

The timing is perfect for a modern-day CG125 bike too. People in the EU are finally, painfully, going to get their heads around the `new poverty’ this winter, as more banks go bust, factories close and food prices continue to rocket. In a climate like that, those who need transport first, and fashion/fun second, will choose something like the CBF125 to beat extra `congestion’ taxes, or parking charges levied by increasingly cash-desperate governments.

CRYSTAL BALLS DEPT.

The trough of the EU recession is probably going to be the winter of 2009/2010, when house prices, stock markets and consumer demand, will hit rock bottom. Also unemployment will peak in spring 2010. By that time at least one major European bank group/economy will have been obliterated in a catastrophic financial crisis that will drag down three or four international companies with it.  Some rioting/looting by those who have lost everything will provoke draconian regulatory action by EU finance ministers at that point, triggering a slow recovery.

The worst is yet to come, but don’t panic. For the majority of us, who will still have some kind of job, the CBF125 might prove a wallet-saving alternative to running a car next year, or paying spiralling public transport fares.

So Honda’s timing is absolutely perfect and this bike, given a couple of million sales across the globe next year, may also save the company from its exposure to the collapse of the `Mommy MPV’ market which is just around the corner and will decimate Honda’s US car dealer network as revenues tumble.

Keep smilin’

insider

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