With roughly 2.5 to 3 million two wheelers sold this festive season, the segment has seen double-digit growth after a flat patch in the same period last year.
The Indian two-wheeler market which posted a flattish sale in the 2022 festive season is back to a strong double-digit growth inching closer to previous peak on the back growing economy and initial signs of revival at the bottom end of the pyramid. Close to 2.5 to 3 million units are estimated to have been retailed between Navratri and end of Diwali season.
The leading players Hero MotoCorp, Bajaj Auto and TVS Motor — three of the top four two-wheeler makers claim to have grown by double digit in the first half of this season starting from Onam in August till Navratri in October are estimated to have sustained the strong momentum of Navratri and Dussehra into Dhanteras and Diwali, concluding the season with Bhaidooj.
Hero MotoCorp, the largest two-wheeler maker, had already guided for a strong double-digit growth during the analyst conference call. Niranjan Gupta, CEO of Hero MotoCorp had told analysts that the demand momentum has been very strong both on rural and the urban markets. “The festive season has started off very well and overall, we do expect momentum building as we move forward. So far, we have grown by 15 percent and we expect that the market will grow in double digits this season,” Gupta had said.
Hemal Thakkar, Senior Practice Leader and Director at Crisil says that the two wheeler inventory has come under relative control just pre-festive season and the segment has had a good run up during Navratri. “Diwali is also expected to be very good for two wheelers. Low base is one of the major reasons for growth being visible. Somewhere the reduction in FAME subsidies for EV2ws has also helped revival of ICE scooters and urban demand is also picking up. Entry level (<110cc) segment which was struggling is seeing some momentum as prolonged replacement is seen happening now. Overall we expect ICE 2w sales to end in lower double digit growth in FY24 while EV2ws to cross a million units during FY24.”
Last festive season, Hero MotoCorp had sold over 1.2 million vehicles between Navratri to Diwali, this time around, assuming a minimum growth of 15 percent guided by the company, the company is likely to have retailed about 1.3 to 1.4 million.
And both its key Indian rivals Bajaj Auto and TVS Motor Company have already outperformed the market in the first half of the season from Onam to Dussehra and both the companies had expressed confidence in posting double digit growth this season. “We are expecting 12-15 percent industry growth during the festive season as compared to a similar period last year. Our recently launched Pulsar N150 is doing well, and we expect to outpace the industry growth on the back of our strong performance in the 125cc plus segment,” Sharma told our sister publication Autocar Professional during a quarterly media conference call.
This growth can be attributed to a key segment of entry two-wheeler buyers coming back. Hero MotoCorp has already witnessed a growth growth in its 100-110 cc segment led by the new launches and TVS Motor Company too believes that the rural market is coming back and it will help the overall market.
Federation of Automotive Dealers Association — in its review of the Navratri Dussehra season had said, that the 2w category saw several positive trends, buoyed by festive cheer and stronger rural demand. Enhanced availability of models, especially those in high demand from the previous year, along with better financial schemes, contributed to a solid market momentum.
“States going into elections also injected optimism into the market, leading to an increase in government spending and improved liquidity. Despite a shift in festival dates with Diwali moving to November, the anticipation of the festive season stimulated purchase intent and dealers reported good stock preparation and robust ground efforts that led to an uptick in sales figures, showcasing a resilient and adaptive market,” added the statement from FADA.
The average inventory for the two-wheeler segment was adequate at 40-45 days and there were numerous schemes being rolled out by vehicle makers to woo buyers, especially for the entry segment and in the rural and semi-urban areas.