Two-wheeler companies end the year flat

Two-wheeler manufacturing companies ended 2015-16 on a sombre note with a low single digit growth following slump in demand from the rural market which generates two in every five two-wheelers sold in the country.

The year saw many launches in both the motorcycle and scooter categories from Hero, Honda, Bajaj Auto, TVS Motor Company, Yamaha, Suzuki and Royal Enfield. However, growth was driven purely by scooters even as motorcycles, especially the budget segment, struggled to gain momentum.

Market leader Hero Motocorp, reported nearly no growth in sales ending the year at 6,632,322 units as compared to 6,631,826 units sold in 2014-15. Though new models have picked up pace its scooter range command a share of just 13 per cent in Hero's total sales. However, its March sales reported a growth of 14 per cent.

Pawan Munjal, Chairman, Managing Director and CEO, Hero MotoCorp said, "In the past five years, we have consolidated our leadership in the face of a volatile market and intense competitive environment, even as Brand Hero has become globally known, with presence in about 30 countries across Asia, Africa and Central & South America".

Erratic and deficient monsoon last year played spoil sport for the industry. For Hero Motocorp more than 40 per cent of its volumes comes from the rural belts. The company is banking on a favourable monsoon for a revival this year.

"The industry witnessed mixed fortunes in FY '16 with sales looking up in the second half of the year. Timely measures by the government and a good monsoon will be essential in sustaining this positive trend. The journey from here promises to be even more exciting as we gear-up to launch our in-house developed products", added Munjal.

Hero's arch-rival and the country's second biggest two-wheeler maker, Honda Motorcycle and Scooter India (HMSI) posted nearly 5 per cent growth during the year ending at 4,483,459 units as scooter demand remained upbeat.

Sales during 2014-15 stood at 4,283,345 units. "Increased efficiency and flexibility in production translated to a growth of 1 per cent even as Honda's all three existing plants in India continued to run on peak capacity", stated a release from the Delhi-based company.

HMSI is expanding capacity to meet customer demand through its fourth plant located in Gujarat with a capacity of 1.2 million units annually.

Chennai-based TVS Motor, the third largest two wheeler seller in India clocked the best growth amongst the top four. The company sold 2,567,881 units during last year, marking a growth of nearly 6 per cent as against 2,432,650 units sold in 2014-15.

Niche bike maker Royal Enfield clocked the highest growth last year at 52 per cent as demand for its Classic range continued to beat supply. The Chennai-based company clocked 600998 units last year as compared to 395,437 units sold in 2014-15.

Rudratej Singh, President Royal Enfield said "Royal Enfield has been expanding its production commensurately to meet its customer's expectations to own and ride our motorcycles at the soonest. Royal Enfield's simple yet evocative motorcycles have been aspirational yet accessible that provides a pure motorcycling experience to our customers. This experience has created strong demand for our motorcycles that continues to grow our order books."