Roundup: Indian motorcycle makers cut production as sales plummet
- Chanda
0 Comment(s)
Print
E-mail Xinhua, October 16, 2012
Roundup: Indian motorcycle makers cut production as sales plummet
KOLKATA, India, Oct. 16 (Xinhua) -- With motorcycle sales declining for the first time in three and a half years caused by surging interest rates and fuel prices, two-wheeler makers in India have slashed production sharply since August to prevent a build-up of inventory.
Data available from the Society of Indian Automobile Manufacturers (SIAM) showed that motorcycle sales in the country dropped 8.46 percent in August from a year earlier, the first since January 2009.
The data also showed that the nine key players in the motorcycle sector together rationalized production by over seven percent to 1,199,832 units in August.
While Hero MotoCorp, the country's largest two-wheeler maker, reduced production by around 14 percent to 443,026 units, rival Bajaj Auto slashed its output by 11.8 percent to 297,487 units.
However, Honda Motorcycle and Scooter India (HMSI), Royal Enfield and Suzuki Motorcycle India have bucked the trend on the back of strong rise in sales.
While HMSI recorded robust sales of scooters as well as motorcycles, driven by the newly launched commuter bike 'Dream Yuga', Royal Enfield sells premium motorcycles (with engine capacity higher than 250 cc) which are relatively insulated from the slowdown. Suzuki, in the meantime, grew strongly on a low base.
"Retail sales have been slow in the two-wheeler industry in July and August. I do not expect September to be better. We already have stocks for the festive season. We are correcting production to prevent build-up of inventory," Pawan Munjal, CEO of Hero MotoCorp, said.
Company sales of two-wheeler vehicles declined 12 percent to 431,739 units last month.
K. Srinivas, president of motorcycle division of Bajaj Auto, shared the concern. "The motorcycle industry has been showing signs of slowdown right from November 2011. Bajaj read the signs early and as per our policy, we have been billing only what finally gets retailed. Both urban and rural markets have slowed down," he said.
Overall, two-wheeler (including motorcycle) sales declined 4.50 percent to 1,057,925 units in August. The sagging sales, ahead of the festive season, had come as a shock to the industry which had been hoping for a revival in consumer sentiments starting October.
"I expect sales to revive in the festive season. But the outlook for the year will now depend on how sales are in October," Munjal said.
"While we have been unaffected, the industry has been under pressure due to the erratic monsoons. Rural consumption slowed down. But now with the rains reviving, sales are likely to improve in the coming months," Yadvinder Singh Guleria, operating head for sales of HMSI, said in a positive tone. Enditem
Go to Forum >>0 Comment(s)