Motorcycle sales growth hits six-month low in April
Sales of motorcycles grew slowest in six months but maintained a healthy doubledigit growth that the segment picked up since November 2017, as India’s rural markets continue to recover from the note ban and compliance issues related to the implementation of goods and services tax.
Motorcycle sales grew 19.38% to 1.2 million units year-on-year, slowest since November when it had grown at 23.25%, according to data provided by Society of Indian Automobile Manufacturers or Siam.
The pace of growth augurs well for companies such as Hero MotoCorp Ltd and Bajaj Auto Ltd, who saw an erosion in their market share as sales of bikes took a hit due to a prolonged slump in demand in rural areas, where customers prefer motorcycles over popular gearless scooters in urban India.
“Motorcycle sales have picked up again, helping the overall demand for two-wheelers. Our members suggest rural market has picked up,”said Sugato Sen,
NEW DELHI:
deputy director general of Siam, adding that demand is also driven by the marriage season in north India.
Analysts said that heightened infrastructure activity and the prospects of another good monsoon would spike economic activity and demand from rural markets. “The sale this month in two wheelers is the second highest over the last 36 months, close to breaching the 2 million mark which has happened only once in September 2017,” said Sridhar V, partner, Grant Thorton.
Rabi crop has been good and there is reasonable cash in the hands of farmers, said Binaifer Jehani, director at Crisil Research.
Sales of commercial vehicles also rose 76% to 72,993 units largely due to a low base caused by a substantial fall in production of vehicles as the industry had to move to BS-IV norms from BS-III norms from 1 April 2017.
Yet, top commercial vehicle makers such as Tata Motors Ltd, Ashok Leyland Ltd and Volvo Eicher Commercial Vehicles are bullish about the demand for the next two years due to the centre’s unflinching focus on building infrastructure.