Rajan Wadhera, president of Society of Indian Automobile Manufacturers (Siam), says: "The two-wheeler industry is seeing green shoots, especially in the rural market." There is a lot of pent up demand, say two-wheeler makers. Consumer sentiment is slowly looking up, say industry analysts.
Pawan Munjal, Chairman, Hero Motocorp in conversation with Nabeel A Khan, Editor, ET Auto on Business in the New World Order said that India has the inherent advantage of having a large domestic market and can evolve into becoming a manufacturing hub for the world. He was speaking at the ET Global Townhall. Economic Times has launched Global Townhall - A business leadership symposium that aims to bring together the world’s top business leaders. The virtual conclave will engage the most prominent faces from the business community to help shape the global, regional and local agenda for the post-Covid world. Watch
"However, despite moderation, the 2W OEMs will continue to have strong credit profiles characterised by healthy return on capital employed (ROCE) -- average ranging between 18-20 per cent -- and comfortable balance sheets with negligible debt and strong cash and liquid investments," the ratings agency said.
Munjal said India has the inherent advantage of having a large domestic market and can evolve into becoming a manufacturing hub for the world. “India can definitely become a challenger (to China). But right now, China has a long lead over us”, he said.
American cult bike maker Harley-Davidson is downsizing its operations in India and understood to have laid off workers as business has slowed down in the wake of the coronavirus pandemic and outlook remains shaky. The company is slashing production at its assembly operations at Bawal in Haryana.
Five leading two-wheeler makers, namely Hero MotorCorp, Honda 2Wheelers, TVS Motor, Bajaj Auto and Royal Enfield cumulatively despatched over 1.2 million vehicles to their dealerships across the country in July. This meant a 23% growth in sales over the month of June, but a 13% decline over July 2019.
Domestic sales in July this year were at 1,58,976 units as against 2,05,470 units, down 23 per cent, Bajaj Auto said in a regulatory filing. Total motorcycle sales stood at 2,38,556 units, a decline of 26 per cent, as compared to 3,22,210 sold in July last year.
Total two-wheeler sales were at 2,43,788 units last month, as compared to 2,65,679 units in July 2019, down 8 per cent, while domestic two-wheeler sales were at 1,89,647 units in the period under review.
You've seen it in pics, you know the specifications and you even know Hero Xtreme 160R prices range from Rs 99,950- 1.03 lakh (ex-showroom). But how does it all come together? Rishabh Bhaskar brings you the full review of the much-awaited new Hero.
"We are seeing month-on-month improvement in sales. There was no sale in April while the decline was very large in May. June was significantly better than May and July is much better than June," Bajaj Auto CFO Soumen Ray told.
The company said it had ended 2019-20 fiscal with sales of over 6.5 lakh units of BS-VI compliant two-wheelers. “It's a matter of great pride for us at Honda, that our 11 advanced BS-VI models have won the vote of confidence and created a new joy of riding among customers across India," HMSI Director - Sales and Marketing Yadvinder Singh Guleria said in a statement.
Hero MotoCorp and Bajaj Auto are hopeful of recovering the sales lost during the lockdown in the rest of the fiscal year, as the country’s top two motorcycle makers are surprised by a quick bounce back in demand.
Two-wheelers have demonstrated signs of a faster recovery than other industry sub-segments, as forecasted by Ind-Ra, on account of a continuous demand from the rural segment as well as two-wheeler being the most-affordable vehicle, favouring personal mobility, it said.
While Venu Srinivasan of TVS Motor was an exception, as he took a pay cut, Pawan Munjal of Hero MotoCorp, Bajaj Auto’s Rajiv Bajaj and Siddhartha Lal of Eicher Motors, which owns Royal Enfield, took home higher salaries, as per the annual reports of the companies for fiscal 2020. The compensation includes basic salary, perquisites, allowances and commission.
In the first phase of the journey to achieve its new vision to “Be the Future of Mobility”, Rajat Bhargava will assume the newly created role of Chief of Staff in the office of Chairman and CEO Dr. Pawan Munjal. Bhargava has so far been heading Strategy, Global Business and Emerging Mobility Business Unit (EMBU).