Mumbai: The scooter segment, which was almost neck and neck with motorcycles in the last fiscal, has doubled its growth rate in the first two months of the current fiscal.
Last fiscal scooters grew 26% while motorcycle sales jumped 27%. While scooters are currently growing at 49%, the growth rate for motorcycles is about 21%, though it is too early to say if this sort of growth is sustainable.
Pramod Kumar and Mitakshi Asher, analysts, J M Financial, in anote on June 15, said scooters (nearly15% of total two-wheelers) are expected to outperform motorcycles (80% of total two-wheelers) by 2% for the next few years on account of higher number of female users, rising congestion in cities, multiple purpose usage and unisex appeal.
Kumar said, “During the 2009 economic meltdown customers postponed their purchase and the pent-up demand showed up in early 2010. This led to the growth in fiscal 2010 which is spilling over in fiscal 2011 as well.”
While this growth comes on a low base effect of last year, Atul Gupta, vice-president (sales and marketing), Suzuki Motorcycle India, said, “In the first two months we are seeing scooters growing faster than bikes and this due to couple of factors.”
Not only the popularity of scooters with the woman segment fuelling the growth, scooters are also penetrating into the younger age group and it not just the women and 35 plus age group phenomenon, he said.
“The most important group that is adding to the numbers is the 20-25 plus age group, a typically bike preferring segment. The other important factor is that scooters are now penetrating into the eastern market where it was virtually absent all these years,” Gupta said.
Despite the production shortage, which most of the two-wheeler manufacturers faced due to lack of component supply, the industry experts say that the scooter segment has grown from 10% in the first two months of previous fiscal to 20% in the corresponding period of this year.
Had there been no shortage the growth could have been 50%, Gupta said. The scooter segment is in a sweet spot as demand outstrips supply. Due to the introduction of Activa in 2001 by Honda Motorcycle and Scooters (HMSI), the segment, which was once declining, is growing rapidly now.
Naresh Rattan, vice-president (marketing and sales), HMSI, said, “Until the mid 90s, contribution from scooters was more than motorcycles and then it started to sharply decline as better bikes started flooding the market. But this trend has reversed with gearless scooters coming into the market, which also provide the same mileage and maintenance cost as that of a motorcycles.”
HMSI, which has a 55:45 split between scooters and motorcycles, believes that the scooter segment has earned a respectable position in the two-wheeler market and it will reach its full potential but will not replace the bike market. Rattan said, from the current share of nearly 15% of the total two wheeler market it will reach up to 20% soon.
TVS Motors, with its recently launched Wego, too, hopes to double its revenue from scooter sales in the current fiscal.
It has been reported earlier that the company is looking at the sales from the scoter segment to reach Rs 1,500-1,600 crore in the current fiscal, double that of Rs 800 crore in the last fiscal.
TVS is now eyeing sales of 480,000 units of scooters this fiscal against 300,000 units sold last year.
HS Goindi, president (marketing), TVS Motors, said currently scooters constitute 20% of our total sales and this number will be much higher next year.
http://www.dnaindia.com/money/report_scooters-growing-faster-than-motorcycles_1404504