Scooters in top gear in dull two-wheeler market

While a couple of months’ data may not signify a lasting trend, India seems to be increasingly driving in the direction of scooters.

Domestic sales have been steadily growing over the past few years, touching a third of all two-wheeler sales during July.

Data from the Society of Indian Automobile Manufacturers (SIAM) show that scooters accounted for 4.32 lakh, or 33 per cent, of the total 13 lakh of all two-wheelers sold last month. This is a significant change from a share of 28 per cent (3.74 lakh units out of a total of 12.98 lakh) in July 2014.

In June 2015, the share of scooters stood at 28 per cent against 25 per cent in the previous year period.

For fiscal 2015, while two-wheeler sales grew 8.09 per cent year-on-year to over 16 million units, within the segment, scooters grew 25.06 per cent, mopeds 4.5 per cent and motorcycles 2.5 per cent.

Consider this: in fiscal 2012, 25.6 lakh scooters were sold in the domestic market, accounting for 18.7 per cent of the total two-wheeler sales. By fiscal 2015, the number had risen a healthy 75 per cent, to 45 lakh units.

The Indian two-wheeler industry has overtaken China’s to become the world No 1. With two-wheeler penetration still as low as 17 per 1,000 people, India represents the biggest potential for the segment worldwide.

“The scooter segment has been the engine of growth for the industry and the contribution of scooters has more than doubled from 13 per cent in fiscal 2006 to 28 per cent in fiscal 2015, while the motorcycle contribution has continuously declined from 82 per cent to 67 per cent in the same period,” said Yadvinder Singh Guleria, Senior Vice-President, Sales & Marketing for Honda Motorcycle and Scooter India.

Kumar Kandaswami, Senior Director, Deloitte Touche Tohmatsu India, feels that one of the biggest drivers of growth for scooters is the horizontal manner in which urbanisation is happening today, and scooters still remain a largely urban phenomenon.

“Downtown is moving 10 km away every few years, and jobs are going to satellite towns,” he pointed out, adding that getting to these workplaces calls for a multimodal structure of transport, which scooters are ideally positioned to play.

According to Bharat Gianani, Senior Research Analyst – Automobiles at Angel Broking, the proportion of scooters in overall two-wheeler sales is poised to further grow by a couple of percentage points in the next two-three years.

Further growth “As women find scooters easy and comfortable to use, it becomes the multi-purpose vehicle of choice in a family,” he said, adding that the other most significant feature that works in a scooter’s favour is the availability of storage space.

Echoing his thoughts, Honda Motorcycle’s Guleria said: “Scooters have come to represent the metamorphosis of the society. The superior convenience and unisex appeal coupled with product features have resulted in an increasing number of women shifting from being pillion riders to riders themselves.”

While the official registration data of Honda shows that around 25 per cent of its scooter customers are women, the internal estimate places this number at a much higher 35 per cent.

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