Motorbikes see Q1 revival, rural India buys commuters, midsize market zooms

The first three months of the 2023 financial year have given India Auto Inc reason to smile. With cumulative wholesale sales of 4,935,870 units across the passenger vehicle, utility vehicle, three and two-wheeler segments, the 55% year-over-year growth lays the foundation for a solid fiscal year. improved, after the 2020 and 2021 financial years affected by Covid.

The largest volume contributor, of course, is the two-wheeler segment with 3,724,533 units or 75% of total industry sales in April-June 2022. Motorcycles are the largest sub-segment of two-wheelers and accounted for 2,405,228 units or 64% of the total two-wheelers. Scooters accounted for exactly half of that number – 32% or 1,207,903 units and mopeds accounted for the remainder at 111,402 units.

In the first quarter of fiscal 2023, the two-wheeler segment saw 54% year-on-year growth, with scooters seeing 100% growth on a lower basis than motorcycles, which saw a year-on-year increase 38% annually. Remember, just three months before the start of FY2023, the overall two-wheeler market was down 11% to 1,34,66,412 units in 2022 (FY2021: 1,51,20,783) – motorcycles were down 10.34% to 89,84,186 units (fiscal year 2021). : 1,00,21,231) and scooters also down 10.55% to 40,09,076 units (FY2021: 44,82,305). Clearly, the improved numbers in the first quarter of fiscal 2023 mean the green shoots of revival are visible and in the motorcycle market, that translates to commuter bikes which are the ones boosting the numbers.

Green sprouts of revival in rural India, frugal commuters in demand
A close look at the first quarter wholesale sales figures released by SIAM for the 11-sub-segment motorcycle engine categories reveals that the bulk of the first quarter purchases occurred in the frugal bike category – primarily bikes. 100-110cc bikes that excel at stretching every ounce of expensive gas to the max. More than 1.2 million (1,276,764 units) of them were sold, registering strong growth of 35% year-on-year and accounting for 53% of total motorcycle sales in the first quarter.

No surprise then as to which OEM is the big winner here – Hero MotoCorp with 1,049,687 units includes the HF Deluxe, Passion and Splendor, has 82% of that entry level bike market share, followed by Bajaj Auto with 93,552 units (7.3% share), TVS Motor Co with 85,094 units (6.6% share) and HMSI with 48,431 units (3.79% share).

These entry-level 100-100cc bikes are the machines of choice for the people of rural India, people who go about their daily chores – whether it’s delivering milk or other food, transport children to school or a myriad of other activities on two wheels. Demand is also coming from the bottom of the pyramid in urban India, where frugal commuters are back on ‘hybrid’ duty as working from the office makes a comeback.

Rapid growth in the 110-125cc segment
When a segment that sells vehicles over six figures grows 66% year-over-year, it shouldn’t be laughed at. As young riders gradually move from the humble 100cc shuttle to more energetic and frugal 125cc bikes, this segment recorded sales of 691,022 units, up

Arguably, urban India is also responsible for the growth of the 110 to 125cc category, one that is seeing increasing numbers of young people moving up from entry-level 100cc bikes. This segment recorded sales of 691,022 units, up 66% year-on-year from 415,449 units in the first quarter of fiscal 2022. Here, Honda Motorcycle & Scooter India turns the tide on Hero MotoCorp with sales of 351,125 units or 51%; Hero made half of that – 173,711 units or 25% share, followed by Bajaj with 150,732 units with 22% share and TVS with 15,454 and 2% segment share.

The 125-150cc market fell by 6%
This segment, in which Bajaj and India Yamaha Motor are the two biggest players, saw sales drop 6% to 76,666 units (Q1 FY2022: 80,031), but that’s because Bajaj sales here fell by 52% to 25,785 (Q1 FY2022: 53,639) while Yamaha sold 50,881 units of the FZ and SZ, registering a smart growth of 92% YoY.

150-200 cc: 6% growth in the first quarter
This category, which has six players in Bajaj Auto, Hero MotoCorp, HMSI, India Yamaha, Suzuki and TVS Motor, recorded wholesale sales of 180,245 units, only 6% higher than the 169,947 in the first quarter of the year. 2022, indicating that demand has yet to reach sustained levels here. While three players saw year-over-year sales increases, three saw declines.

Although TVS sold the maximum here – 51,123 Apaches – it was down 36% year-on-year (T!FY2022: 79,576). HMSI with 24,708 units is down 31% and Suzuki also down with 2,139 units (-36%).

Yamaha was the top performer with 47,995 units (101%) sold, with the combination of the MT 15 and R15 proving a hit with motorcycle enthusiasts. Bajaj Auto, with 30,935 units from its Avenger, Husqvarna, KTM and Pulsar range, posted 64% growth in the first quarter. Hero MotoCorp sold 23,345 units, up 176%, but off a low base of 8,455 units a year ago.

200-250cc: why not take off?
It is difficult to understand why this segment does not take off. Only 9,295 units sold and that also represents a 33% drop from sales of 13,794 units a year ago. Is a lack of exciting, value-for-money products the reason for the slowdown in the 200-250cc segment? Bikers may prefer to spend a little more and take it to the next level.

250-350cc: the magic of intermediates on the move
If there’s one segment that has the potential to be hugely successful, it’s the mid-size motorcycle category, broadly divided into two sub-categories – the 250cc to 500cc engines that power the larger models. small and affordable, and engines from 500cc to 800cc. that straddle the high end of the mid-size bike market.

The rapid reduction in the price gap between these bikes and the feature-rich premium 150-200cc commuter bikes is pushing buyers into the 250-350cc category. Many first-time bike buyers who can’t afford a big, muscular superbike are fond of a smaller, stylish, performance-oriented machine with value for money written all over it.

There is also the global trend of OEMs around the world to offer lighter models with easy driving dynamics and a comfortable ergonomic seat height, making them practical for commuting around town as well as for excursions on the coast. highway with the wind in your hair.

Royal Enfield and its Bullets have fully taken over this segment with 141,844 units, up 44%, and representing an overwhelming 93% of this market. No. 2 player HMSI sold 8,744 units of the CB300 while TVS Motor with 1,052 units of the RR 310 was in third place, followed by Kawasaki with 367 units of the Ninka 300.

350-500cc: Bullet 500 the big winner
With a total of 13,357 units sold, up 108% year-on-year (Q1 FY2022: 6,416), this category replicates the growth in demand from the 300cc market. Royal Enfield’s Bullet 500 with 10,857 units held an 81% share with Bajaj and its Dominar-Husqvarna-KTM combine selling 2,496 units, up 2.6%.

500-800cc: Royal Enfield overwhelms this one too
With 5,310 bikes sold in this category, year-over-year growth was 114%. No guesswork here knowing who’s leading here – Royal Enfield’s 650cc twins. Next best is India Kawasaki with 180 units split between its Ninja 650 and Versys. It is followed by Triumph Motorcycles India with 124 units of the Street Triple.

GROWTH PROSPECTS: Cautiously optimistic
At first glance, the poor market sentiment that had bogged down mass-market motorcycle sales in rural India appears to be fading. While high gasoline prices, inflationary pressures and cost of ownership continue to be challenges in the commuter bike segment, sustained demand from rural India will help boost the motorcycle market. In the coming months.

No such inflationary pressures for the midsize or luxury bike market, where sales are growing at a rapid pace. For example, BMW Motorrad India is heading for record sales this year. In the first six months of 2022, it sold a total of 3,114 units – 60% of the company’s total sales for the year 2021 – were sold at retail, enabling smart growth of 56.7%.

With three fiscal months over and nine still to go, it is still early for India Auto Inc and the two-wheeler industry to confirm whether sustained growth is here to stay. But with a bountiful monsoon across the country, it bodes well for the agrarian economy, and the benefits trickle down to the two-wheeler and tractor industry first, followed by the rest of the automotive industry. , and it already is.

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