Two-wheeler segment posts healthy growth as both scooter and motorcycle segments grow in

double-digits

The two-wheeler industry performance has been strong during FY2018, reporting YoY growth of 14.5% during
11m FY2018. The year was characterised by periodic swings in growth rate caused by a confluence of factors,
e.g., channel filling by OEMs during April 2017 (post BS IV) and July 2017 (post GST rollout), pre festive season
dealer stocking during August-September 2017. During the latter half of the fiscal, the growth gained pace,
supported by strong double-digit growth during November 2017-February 2018 partly driven by low base of
previous fiscal and partially benefitting from positive demand sentiments, especially from the rural market.
During 11m FY2018, both the major products segments of scooters and motorcycles contributed to growth,
expanding by healthy double-digits over the corresponding previous. While scooters have reported a YTD
growth of 21.2%, the motorcycle segment also reported double-digit YoY growth of 12.7% during the same
period, being the first instance of double-digit growth of the motorcycle segment since FY2012. Although the
moped segment had reported healthy growth of 23% during FY2017, the volumes decreased by 4.8% during
11m FY2018, in absence of new model launches and shift of consumer preference towards lower displacement
motorcycles.

Industry leading growth in scooter segment driven by low base of previous fiscal and positive
demand sentiments

The scooter segment has reported positive demand trends during all three quarters of the current fiscal,
supported by the underlying factors that enabled the industry growth. Overall, during 11m FY2018, scooters
reported growth of 21.2% with lowest growth of 0.5% during October 2017 (owing to high base of October
2016), outpacing the industry growth and continuing to gain share in the overall domestic two-wheeler mix.
Among the three sub-segments, the <90cc sub-segment, which has a single product segment of TVS Scooty
Pep+, reported growth of 41% during 11m FY2018, albeit over a low base. The largest 90-125cc sub-segment
reported 21% growth during 11m FY2018, led by Honda Activa, the largest selling two-wheeler in the country.
The 125-150cc sub-segment consisting of premium scooters reported healthy growth of 53% during the
period, with growth driven mainly derived from urban areas.

Motorcycles revive gradually on the back of entry-level sub-segment

While demonetisation had marred the growth in the motorcycle segment during the second half of FY2017,
the product segment revived impressively since the beginning of the current fiscal. While channel-filling and
dealer-stocking prior to festive season supported the sales during the first half of the year, the demand
recovery and positive sentiment has continued into the second half of the fiscal as well. The growth has been
led by the entry-level 110-cc sub-segment, driven by a general improvement in rural demand sentiment on the
back of near normal monsoon. The executive sub-segment of motorcycles (110-125cc) also contributed to
maintaining the growth momentum, despite volatility in growth trends reported during the course of the fiscal
due to production constraints faced by one of the best-selling models, Glamour. The 125-150 cc sub-segment
continues to be the only sub-segment in motorcycles where volumes have been shrinking, owing to growing
preference for 160-cc and 180-cc offerings of OEMs. The higher displacement premium motorcycles continue
to expand their share in the domestic motorcycle pie and accounted for 7% of the total volumes in 11m
FY2018 as against 2% in FY2014. This trend is expected to continue with the gradual up-trading and
premiumisation in the country, supported by improvement in disposable incomes.

Present statistics

   Hero MotoCorp Limited (Hero): Recovery in rural demand translated into healthy growth in Hero’s
strong hold entry sub- segment of motorcycles, which accounts for close to 60% of the total segment.
The OEM continued to maintain its dominance in the domestic motorcycle segment with a YTD
market share of 51.2% during 11m FY2018. However, due to relatively weak presence in the fast-
expanding scooter segment, its overall share in the two-wheeler market has been steadily declining
and contracted further to 36% during 11m FY2018, from 37% during the previous year. Going
forward, improving its presence in the two fastest growing segments of scooter and premium
 motorcycles would remain critical to improving its leadership position in the domestic two-wheeler
market.
   Bajaj Auto Limited (Bajaj): During the current fiscal, although Bajaj remained the second largest
motorcycle manufacturer in the country, its market share dropped to 16% during 11m FY2018, from
18% during FY2017. Honda has significantly bridged the gap with Bajaj, with a volume difference of
~14,200 units during 11m FY2018, as against 4.65 lakh units in FY2017. Coupled with Bajaj’s absence
from the fast-growing scooter segment, its share in the overall domestic two-wheeler market
declined to 10% during the current fiscal, almost half of its share just 6 years ago.
   Honda Motorcycle and Scooter India (Honda): Honda has achieved impressive market share gains
in both the motorcycle and scooter segments, thereby expanding its share in the overall two-wheeler
pie and inching closer to the largest player, Hero. Scooters remain its strong forte, with a market
share of 57%, supported by continued strong demand for its Activa model. Increasing acceptance of
scooters in the market and additional capacities that came on-stream in Gujarat (scooter only) helped
growth. In the motorcycle segment also, Honda gained share in the all the lower displacement
motorcycle categories (upto 150-cc) and has almost closed the gap with the second largest player,
Bajaj. Overall, the OEM expanded its market share in the domestic two-wheeler market from 27%
during FY2017 to 29% in 11m FY2018, benefitting from its market share gains in both segments.
   TVS Motor Company Limited (TVS): TVS has reported fairly stable market share trends,
maintaining its position as third- largest two-wheeler player during 11m FY2018, supported by its
presence across product segments. The OEM displaced Hero MotoCorp from its position as second-
largest scooter manufacturer during FY2017 and has further strengthened its position during the
current fiscal to 16% market share. In the motorcycle segment, TVS remains the fourth largest player
with a market share of 7%, similar to the previous fiscal.

 55,66,036 Scooters, 1,12,14,640 Motorcycles and 6,36,940 scooters were

sold in FY2019-20.

The overall two wheeler industry degrew by -18% in FY2019-20 v/s FY2018-19. In terms of
volumes; Motorcycles still command twice the numbers of Scooters sold in the Indian
market. Even in FY20; 64% of Two Wheelers sold in India were Motorcycles.
Top 10 Selling Motorcycles:

Top 10 Selling Scooters:

Two Wheeler Modelwise Sales for FY2019-20: