Italian auto major Piaggio expects a recovery in demand from the second half of the current year following the formation of a stable government at the Centre.

“Our expectation is that now we have more clarity over all, there will be a recovery of demand in the second half of the year,” said Piaggio Vehicles’ India Managing Director and Chief Executive Officer, Diego Graffi.

The automaker also plans to renew its scooter products with new content in the next 2-3 years, besides launching an India-specific scooter next year,

Piaggio Vehicles India, a wholly-owned subsidiary of Italy’s Piaggio Group, sells Vespa and Aprilia brands of scooters, and is a leading player in the diesel three-wheeler segment.

Piaggio is currently present in the 125-150 cc premium scooter segment, in which it commands 9-10 per cent market share.

He said both passenger and commercial vehicles of the company have so far seen a growth, which is either at par or at times better than the industry.

According to him, the growth this year has been better than last year.

He said factors such as new safety norms, which increased the cost, and also hike in duty on completely built units (CBUs) have also contributed to the situation, impacting the growth of the industry.

It has become mandatory to have CBS (combined braking system) or ABS (anti-locking braking system) in all bikes and scooters from April this year. This has resulted an increase of around ₹5,000 in scooter and ₹25,000 in motorcycle prices.

“Our product and network base is very strong and capable to compensate or any other external factor that can negatively affect the demand,” he said.

New scooter brand

“We will have a completely new scooter brand coming in 2020. It will be fully customised and designed for Indian customers with lot of contents,” he said.

Graffi, however, ruled out Piaggio’s entry into the mass segment saying, “We are always perceived as the ones, who are into premium play. We don’t intend to get into the commuter segment. We look only at scooter market, about 125 cc, which is one million in size currently.”

”We only focus on network and its expansion and brand reputation. This is our target,” he added.

According to Ashish Yakhmi, head of 2-Wheeler business, Piaggio Vehicles, the company has doubled network in last one-and-a- half year to about 250 that has also helped in growth and it plans to add 100 more in the next 18 months.

“A lot of new customers are coming in from non-metro markets,” Yakhmi added.

Graffi said, “We are also thinking of motorbikes in the mid-range of 150-250 cc in the Indian market. We have product in our portfolio outside India that could be suitable, but again we want to introduce the right product with a right price position, and with the right performances.”

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