Indian Scooter Market
In recent years, the Indian scooter market has experienced a dynamic transformation, reflecting significant changes in consumer preferences, technological advancements, and market dynamics. As of November 2023, the industry is witnessing a remarkable resurgence, particularly during the festive season, which traditionally boosts consumer spending.
Electric Scooters India
Summary :
- Scooter demand is back in India, with October 2023 sales being the best monthly numbers in the fiscal year to date.
- Honda remains the market leader, but TVS, Suzuki, Yamaha, Ather and Bajaj Auto have all increased their market share in April-October 2023.
- Electric two-wheeler leader Ola Electric is not a member of SIAM, but has a commanding share of 31% in April-October 2023.
- The scooter market is yet to see fulsome demand come its way, but the green shoots of recovery in rural India are welcome news.
- Expect fireworks in the November 2023 numbers.
Honda Activa Sales
Additional insights:
- The growth of the scooter market is being driven by a number of factors, including the festive season, the launch of new models, and festive-season offers.
- The electric scooter segment is also growing rapidly, with Ather and Bajaj Auto seeing strong sales in April-October 2023.
- The cost of two-wheeler ownership has increased over the past year, but this is not deterring buyers, especially in the rural market.
This period has proven to be a catalyst for growth, particularly in the two-wheeler segment that encompasses scooters, motorcycles, and mopeds. The market dynamics of this period offer a fascinating glimpse into the evolving landscape of the Indian automobile industry, shaped by competitive forces, evolving consumer trends, and the increasing prominence of electric vehicles.
TVS iQube Growth
This article provides a comprehensive overview of the current state of the Indian scooter market as of November 2023. Here’s a summary of the key points:
- Overall Market Growth: The Indian two-wheeler market, including scooters, motorcycles, and mopeds, has shown a significant year-on-year growth of 20%, with total sales reaching 2.36 million units.
- Scooter Segment Performance: Scooters, holding a 47% share of the overall two-wheeler market, registered a sales volume of 589,802 units in October 2023, marking a 15% increase compared to the previous year.
- Leading Brands and Market Shares:
- Honda Motorcycle & Scooter India (HMSI): Despite a slight decline in market share, HMSI, with its Activa brand, remains the market leader, accounting for 44.43% of the scooter market.
- TVS Motor Co: Experiencing a 10% year-on-year growth and an increase in market share to 24.88%, TVS has gained traction, partly due to the success of its iQube electric scooter.
- Suzuki Motorcycle India: Achieved a 22% growth in sales, boosting its market share to 14.74%.
- Hero MotoCorp and India Yamaha Motor: Also showed growth, with Yamaha’s market share rising to nearly 5%.
- Rise of Electric Scooters: Both Ather Energy and Bajaj Auto have seen significant growth in their electric scooter sales, with Ather achieving a 1.74% market share and Bajaj Auto 1.57%. Ola Electric, not a SIAM member, leads the electric two-wheeler market with a 31% share.
- Industry Challenges and Outlook:
- The scooter market, though recovering, has not reached pre-Covid levels.
- Rising ownership costs and tepid demand in the entry-level segment remain challenges.
- Rural recovery is a positive sign for the industry.
- Festive Season Impact: The festive season has traditionally boosted sales, and despite a 12% decrease in two-wheeler retail sales in October 2023, there is an expectation of improved numbers in November.
Two-Wheeler Market Trends
Key Analysis
The key analysis of the Indian scooter market as of November 2023 can be broken down into several critical areas:
- Market Growth and Recovery Post-Pandemic: The Indian scooter market has shown a strong recovery with a 20% year-on-year growth. This resurgence indicates a bounce-back from the slump caused by the COVID-19 pandemic, highlighting the sector’s resilience and adaptability in the face of challenges.
- The dominance of Honda and Emerging Competition: Honda, with its Activa brand, continues to dominate the market but has seen a slight dip in its market share. This change signifies an increasingly competitive market landscape, where other players like TVS, Suzuki, Yamaha, Ather, and Bajaj Auto are gaining ground.
- Rise of Electric Scooters: The electric scooter segment, led by brands like TVS’s iQube, Ather Energy, and Bajaj Auto’s Chetak, has seen significant growth. This trend is reflective of a global shift towards electric vehicles, driven by environmental concerns and advancements in EV technology.
- Market Share Shifts and Performance of Key Players:
- TVS Motor Co: Notably increased its market share, thanks in part to the popularity of its electric scooter, the iQube.
- Suzuki Motorcycle India: Recorded substantial growth, improving its market positioning.
- Hero MotoCorp and India Yamaha Motor: Both showed growth, with Yamaha notably increasing its market share.
- Challenges in the Industry: Despite the growth, the industry faces several challenges, including increased ownership costs and a lag in the entry-level segment. Additionally, the market is yet to reach the pre-COVID sales levels, indicating room for further recovery and growth.
- Impact of Festive Season and Retail Trends: The festive season, particularly Diwali, traditionally boosts sales in India. However, a noted decrease in retail sales in October 2023 suggests that market recovery, while strong, is still subject to fluctuations and consumer sentiment.
- Future Outlook: The market shows potential for further growth, especially with the increasing popularity of electric scooters and the gradual recovery of rural markets. However, the ability of manufacturers to navigate challenges such as rising costs and evolving consumer preferences will be crucial.
Hero MotoCorp Scooters and Ola Electric Market Dominance
The Indian scooter market is in a phase of dynamic change and growth, with a significant shift towards electric vehicles and new players challenging the established market leaders. The sector’s future prospects appear promising, but contingent on how well manufacturers and consumers adapt to the evolving market conditions.
Automobile Industry India
Analyzing the Indian scooter market, particularly in light of the developments up to November 2023, reveals several pros and cons:
Pros
- Market Growth and Recovery: The market has shown robust growth, indicating a strong recovery from the pandemic-induced slump. This growth is a positive sign for the industry and the economy.
- Increasing Popularity of Electric Scooters: The rise in electric scooter sales highlights a shift towards more sustainable and environmentally friendly transportation options. This trend aligns with global environmental goals and India’s push towards electric vehicles.
- Diversification of Options: With multiple players like Honda, TVS, Suzuki, Yamaha, Ather, and Bajaj Auto, consumers have a wider range of choices, from traditional petrol scooters to innovative electric models.
- Technological Advancements: The market is benefiting from advancements in technology, especially in the electric scooter segment, which offers improved performance, range, and features.
- Economic Boost and Employment: The growth in this sector contributes to the overall economy and generates employment opportunities, both in manufacturing and sales.
Cons
- Increased Ownership Costs: Rising costs associated with purchasing and maintaining scooters can be a deterrent for potential buyers, especially in the price-sensitive Indian market.
- Market Saturation Risks: With many players competing in the market, there’s a risk of saturation, which could lead to price wars and reduced profitability for manufacturers.
- Infrastructure Challenges for Electric Scooters: The growth of the electric scooter segment is hindered by inadequate charging infrastructure and range anxiety among consumers.
- Dependence on Festive Season Sales: A heavy reliance on the festive season for boosting sales indicates a vulnerability to seasonal fluctuations and may not reflect consistent year-round demand.
- Slow Recovery in Entry-Level Segment: The slower recovery in the entry-level scooter segment suggests that a significant portion of the potential market remains untapped, possibly due to economic factors affecting lower-income consumers.
- Environmental Concerns: While electric scooters are environmentally friendly, the continued dominance of petrol scooters contributes to pollution and greenhouse gas emissions.
Conclusion
As of late 2023, the Indian scooter market has demonstrated a robust recovery and an upward growth trajectory, signalling a positive turn in the post-pandemic era. The festive season has played a significant role in this resurgence, contributing to an uptick in sales across various brands. While Honda continues to lead with its flagship Activa brand, other players like TVS, Suzuki, Yamaha, Ather, and Bajaj Auto are also gaining ground, particularly in the electric scooter segment.
The increasing interest in electric vehicles, combined with new model launches and strategic market positioning by various manufacturers, has breathed new life into the market. Despite these positive developments, the industry continues to navigate challenges such as rising ownership costs and fluctuating demand in the entry-level segment. Going forward, the scooter market in India appears poised for further growth, bolstered by technological innovations, evolving consumer preferences, and a gradual shift towards more sustainable modes of transportation.
