The Hindu Business Line : Motorcycle sales slow down

THE joyride for motorcycle makers seems to be getting over. After touching the yearly-high sales of 3.67 lakh units in October 2002, it's been a downhill journey for the sector as sales tumbled in the following months.

And now, companies expect March to be the worst month as sales are expected to fall by 8-10 per cent from previous months. "We do not know the reasons for this yet, but March is the biggest surprise of the year," said Mr Atul Sobti, Senior Vice-President, Marketing and Sales at Hero Honda.

"Is it a temporary phenomenon or is it because the rabbi crop is going to be bad? If the latter is the case, even in April-May-June we will have problems," he said.

After October, motorcycle sales started to fall. Sales in November were 3.59 lakh units, while December saw sales plummeting to 2.93 lakh units. There was a marginal recovery in January and February 2003.

"There has been no great recovery in recent months," Mr Sobti said. Hero Honda had earlier lowered its sales target to 1.7-1.72 million units from an earlier projected 1.8 million units for the fiscal 2002-03, citing decline in agricultural production.

According to Mr Harish K., General Manager (Marketing), TVS Motor Company, the situation has not been `a positive one' for the motorcycle sector in recent months.

"Over the last four months, there has been a downturn. This could be due to the prevailing economic conditions," he said, adding that rising petrol prices may also be deterring potential customers from holding back purchases.

Two-wheeler makers have been aggressively offering discounts and freebies to enthuse customers. Hero Honda, India's largest two-wheeler maker, has been offering gifts with every bike bought. TVS recently announced a Rs 2003-discount till March end.

Over the past 3-4 years, motorcycle sales have been robustly growing, mainly at the expense of scooters. In 2002, motorcycles grew by 37 per cent over the previous year, while in 2001 the growth was 20 per cent.

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