Segment set to capture 20% share of two-wheelers in FY13
While motorcycle segment is bracing for a lower growth in single-digits during the current financial year, scooter space continues to maintain strong momentum in volumes and is expected to register high double-digit growth at about 18 per cent. This is come on the back of new launches and growing acceptance of gearless scooters, particularly by women.
During the first four months of current financial year, scooters sales have seen a whopping 27 per cent growth at 934,546 units, compared with motorcycle sales that grew by six per cent at 3,450,770 units during the period.
“Led by new launches from Honda (Dio), Hero (Maestro), TVS (Pep+) and Suzuki (Swish), the scooter segment is likely to grow at a faster rate of 18.2 per cent YoY for the current financial year as against the estimated 7.5 per cent YoY growth in the motorcycle segment,” according to Surjit Arora of broking services firm Prabhudas Lilladher.
The faster volume growth in the scooter segment would lead to a 140 basis points improvement in its share to 20.6 per cent of the two-wheeler market during the financial year. During April-July period, scooters accounted for about 20 per cent of total two-wheeler sales in the country. Its share was 17.4 per cent in the same period last year.
“The main drivers for this growth in the segment are, growing acceptability of gearless scooters particularly by women, rising urbanisation and increasing proportion of working women, comparatively lower base and new launches. We expect 14-15 per cent CAGR in scooter volume for the next five years,” added Arora.
During the first four months of the financial year, barring TVS Motor and Mahindra 2 Wheelers all other players have reported a reasonable growth. Honda Motorcycle & Scooters India (HMSI) is likely to enjoy its leadership position in the scooters segment with an estimated market share of about 52 per cent in FY13, an increase of 400 bps, led by new Activa as well as Dio.
Like the motorcycles segment, the scooters have also experienced a trend in growing segmentation with the category having three differentiated sub-segments consisting of sub-100cc models, 100cc models and 125cc models, each having its own value proposition and target segment. While the sub-100cc segment scooters are lightweight with fibre-bodies, the 125cc scooters are positioned as power scooters with metal bodies. Amongst these three sub-segments, the 100cc scooters segment remains the largest, whose share in the total scooters market increased from 67 per cent in 2010-11 to 70 per cent in 2011-12.
As the pie is bigger in 100cc segment, Suzuki is now eyeing the segment and is studying the potential to launch a product. “As we have already established presence in 125cc, we don’t want to leave any other opportunity available in the scooter segment,” according to Anand Thakur, national head – sales, Suzuki Motorcycle India.
Yamaha is also preparing for its ambitious foray into the scooter segment shortly. The company is betting big on scooter market and aims to fetch more than a third of its sales in India from scooter segment. Recently, the company signed up Deepika Padukone to endorse its scooter brands, as it plans to target females under the age of 24 years. It has also planned to expand the dealer network in the country from 400 outlets to 2,000 by 2018 focusing more on tier II and tier III cities.
Referring to growing competition in scooter segment, Y S Guleria, vice-president, sales and marketing, Honda Motorcycle & Scooter India said, increased competition would only lead to greater innovation in products and service. Honda will continue to grow its presence across all scooter and motorcycle categories.
