Economy

Opening up in urban centres lifts hopes for demand revival in scooters

G Balachandar Chennai | Updated on October 23, 2020 Published on October 23, 2020

Scooter companies are pinning their hopes on further unlocking of the economy to boost sales   -  REUTERS

Companies in the segment are also buoyant over pent-up demand and festival season boost

As urban and semi-urban centres open up, the demand for scooters has seen a demand revival and companies are cautiously optimistic about the sustainability of the demand.

While bikes have seen an early revival after the lockdown supported by strong rural economy, which is a key for commuter segment bikes’ growth, the opening up of big cities, urban and semi-urban locations on the back of falling Covid-19 cases has helped demand revival in the scooter segment.

Country’s top scooter maker Honda Motorcycle & Scooters India (HMSI) has seen a 40 per cent enquiry growth and more than 45 per cent customer walk-ins during the pre-festival start period, a fortnight before the festival, when compared with 2019 pre-festival period enquiries and walk-ins. The Navratri week and the pre-Diwali period is also expected to give a further boost.

After months, scooters saw a marginal positive growth in September. Total scooter sales in September 2020 stood at 556,205 units as against 555,754 units in September 2019, 456,848 units in August 2020 and 334,288 units in July 2020.

Also read: Passenger vehicle exports dip 58% in H1 on Covid-19 disruptions

Pent-up, festival demand

Companies expect scooter volumes to record a decent growth in this quarter, supported by pent-up demand, festival season boost, and an expected shift to a personal mode of transport from public transport in urban and semi-urban locations, which are the major drivers of growth for scooters.

“After the unlock 5.0, urban and semi-urban markets have completely opened up and almost 100 per cent of our dealerships across the country is operational. So, more markets are available for retail. Since scooters are primarily sold in the semi-urban areas, lockdown posed a major constraint. Now we are seeing momentum back even in cities like Greater Mumbai and Pune, which was under lockdown for a longer period,” said YS Guleria, Director-Sales & Marketing, HMSI, told BusinessLine.

Also read: Passenger vehicle sales record 26% growth in September

He admitted that pent-up demand and shift to personal transport in urban centres, where more people depend on the public transport system, drive demand. Also, scooters are preferred by families in urban locations who can’t afford multiple two-wheelers. Being a unisex product, scooters fit all age and gender groups, he added.

Special editions

Companies have also come out with special editions of their scooter models, backed up some special schemes and offers, to woo buyers during this festival season.

“In the era of social distancing and preference for personal mobility, the two-wheeler segment is playing a pivotal role. This evolving pattern has led to positive sentiments, thus driving the demand for two-wheelers, including scooters. To enhance choices, we have introduced attractive schemes, latest colours, new refreshes and updated pricing across the scooter portfolio,” said a Spokesperson of TVS Motor Company, which is the second-largest player in the scooter segment.

Hero MotoCorp also recently launched two new scooter variants — Maestro Edge 125 Stealth and Pleasure+ Platinum in view of the festive season.

“We have a very clear focus on the scooter segment and our BS6 range has been very well received by the market. As a result, there has been a healthy gain in our scooter market share. We have a robust plan for our scooter portfolio and with our strong products and focused strategies, we are confident of further increasing our market share in the segment,” said a spokesperson of Hero.

‘Premiumisation’ trend

Meanwhile, the “premiumisation” trend is also intact and buyers continue to prefer 125cc scooters across markets, particularly in the hilly States, where more power and torque are needed as well as some other States with higher percentage of “scooterisation”. Suzuki and Honda are also big players in the 125cc segment

“In a State like Himachal Pradesh, the largest selling two-wheeler is Honda Activa 125cc,” said Guleria.

But companies are cautious about the outlook.

“If there is no second wave of Covid-19, the current numbers look sustainable. Also, if colleges and universities reopen, it will provide us with incremental demand. We always see a spike in demand from students and the faculty during college admission period,” he said.

Follow us on Telegram, Facebook, Twitter, Instagram, YouTube and Linkedin. You can also download our Android App or IOS App.

Published on October 23, 2020
This article is closed for comments.
Please Email the Editor