CHENNAI: Two-wheeler sales have declined and the real culprit is multiple price hikes that are largely pinching the entry-level segment. Auto industry sources say that between April-December, prices of two-wheelers have increased by an average of Rs 5,000-8,500, impacting entry levels, where economy is key.
“While semiconductor chip shortage has affected production and sales of cars, in two-wheelers it is a demand problem. The President of the Automotive Component Manufacturers Association (ACMA) said, “Several price hikes due to raw material cost have impacted sales of entry-level two-wheelers. Sunjay Kapur, He said steel prices have gone up by 60 per cent in a year while copper, aluminum and rubber prices have also gone up.
Auto Consultants says the entry-level segment hasn’t really shrunk the most, but its volume hit is due to the highest numbers. Two wheelers are the most affected automotive segment as the second wave has affected the sense of affordability and demand of the target customers. Job losses, wage cuts and low discretionary income due to Covid-induced medical expenses, persistent rise in two-wheeler prices, record high petrol rates, uneven monsoon and delayed harvest and lack of financing availability have dented the prospects of the industry, especially. influenced by. Entry level segment. The 75-110cc segment was down 1.5% in April-November, while the 110-125cc segment was down around 8%. The pricier 125 cc-150 cc segment, however, was down by 36 per cent.
“But the 75cc-110cc segment is about 57% of the total volume, so if that segment doesn’t grow, it is difficult for the entire industry to grow,” he said. The sub-125 cc segment accounts for 75% of the two wheeler market.
According to the data released by Society of Indian Automobile Manufacturers (SIAM), the apex body of the auto industry, saw overall two-wheeler domestic sales decline over 37% in November from 1.6 million units in 2020 to 10.5 lakh units this November. “From March 2019 till now, the prices of two-wheelers have increased by 28%-35%, inclusive of BS6, safety norms and now raw material hike. Also petrol prices have increased by 30% in the last 6 months. It has given a really tough competition to the sub-125 cc segment,” said Hero Motocorp dealer nikunjo Sanghi, MD, JS4Wheel Motor.
What is eating into entry-level sales is the renewed interest in sub-45km range electric two-wheelers, which don’t even require registration and therefore don’t show up on official data. “The cost of setting up an EV showroom is only 10% of the cost of an ICE showroom and EV outlets are coming up across rural India,” said Sanghi. “Entry level sales are also getting affected due to this.
“While semiconductor chip shortage has affected production and sales of cars, in two-wheelers it is a demand problem. The President of the Automotive Component Manufacturers Association (ACMA) said, “Several price hikes due to raw material cost have impacted sales of entry-level two-wheelers. Sunjay Kapur, He said steel prices have gone up by 60 per cent in a year while copper, aluminum and rubber prices have also gone up.
Auto Consultants says the entry-level segment hasn’t really shrunk the most, but its volume hit is due to the highest numbers. Two wheelers are the most affected automotive segment as the second wave has affected the sense of affordability and demand of the target customers. Job losses, wage cuts and low discretionary income due to Covid-induced medical expenses, persistent rise in two-wheeler prices, record high petrol rates, uneven monsoon and delayed harvest and lack of financing availability have dented the prospects of the industry, especially. influenced by. Entry level segment. The 75-110cc segment was down 1.5% in April-November, while the 110-125cc segment was down around 8%. The pricier 125 cc-150 cc segment, however, was down by 36 per cent.
“But the 75cc-110cc segment is about 57% of the total volume, so if that segment doesn’t grow, it is difficult for the entire industry to grow,” he said. The sub-125 cc segment accounts for 75% of the two wheeler market.
According to the data released by Society of Indian Automobile Manufacturers (SIAM), the apex body of the auto industry, saw overall two-wheeler domestic sales decline over 37% in November from 1.6 million units in 2020 to 10.5 lakh units this November. “From March 2019 till now, the prices of two-wheelers have increased by 28%-35%, inclusive of BS6, safety norms and now raw material hike. Also petrol prices have increased by 30% in the last 6 months. It has given a really tough competition to the sub-125 cc segment,” said Hero Motocorp dealer nikunjo Sanghi, MD, JS4Wheel Motor.
What is eating into entry-level sales is the renewed interest in sub-45km range electric two-wheelers, which don’t even require registration and therefore don’t show up on official data. “The cost of setting up an EV showroom is only 10% of the cost of an ICE showroom and EV outlets are coming up across rural India,” said Sanghi. “Entry level sales are also getting affected due to this.
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