March 4 2005. Showa Corp. the suspension manufacturer affiliated to Honda Motor, is to invest about 500 million yen to build a plant for motorcycle shock absorbers in a suburb of New Delhi, India, through its local unit Munjal Showa Ltd., company officials said.

Showa has a 26% stake in Munjal Showa.

The new plant, Munjal Showa's second, is expected to boost the local unit's annual shock absorber capacity to about 2.0 million units from 1.5 million when the second plant goes into operation by the year-end.

Munjal Showa's existing plant produces parts for both cars and motorcycles. Soaring demand for motorcycles in India, where the Honda group holds about a 50% market share, prompted Showa to set up the second plant dedicated to motorcycle parts.

The increased shock absorber output will mostly be supplied to Honda's motorcycle plants in India.

The Indian motorcycle market, the world's second largest after China, is estimated to have expanded just above 10% year on year to 6 million units in 2004.

Source: The Nikkei Business Daily