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The second wave of COVID-19 across India has been kind to none, and lives and livelihoods have been affected across states. Though the affordable and widely-used two-wheeler market was among the first segments to see green shoots in a post-COVID revival in the second half of 2020, the trajectory seems to be fast taking a turn for the worse. Honda and Hero temporarily halted production Bajaj witnessed a 49 percent growth in exports May 2021 is set to be a month of poor sales With lockdowns in many states and factory shutdowns across the two-wheeler ecosystem – including the likes of the world’s largest two-wheeler maker, Hero MotoCorp, and Honda Motorcycle & Scooter India – the going seems to be getting steep and the industry is more or less preparing for a washout May 2021 after drastic drop in April sales. Footfalls in dealerships are also expected to reduce as a result of the lockdowns and this is likely to push sales further lower. It is also important to keep note of the fact that April sales cannot be compared on a year-on-year basis as there were no sales in April 2020, with a complete lockdown instituted to contain the spread of the COVID-19 virus. Hero MotoCorp: 3,42,614 units The world’s largest two-wheeler manufacturer, Hero MotoCorp had a rather quiet April. Temporary closure of its plant operations and retail outlets across several key regions in India impacted sales. It is down over 37 percent from March numbers with total sales of 3,42,614 units in April (March 2021: 5,44,430 units). As the second wave of COVID-19 continues to spread, the company has decided to extend the shutdown at its manufacturing facilities across India, its Global Parts Center (GPC) in Neemrana and the R&D facility – the Centre of Innovation and Technology (CIT) – in Jaipur by another six days until May 9. The plant is expected to be operational by May 10. Honda Motorcycle & Scooter India: 2,40,100 units The lockdowns and the second wave of COVID-19 have led to a 39 percent drop in Honda Motorcycle & Scooter India’s April 2021 sales to 2,40,100 units compared to the previous month (March: 3,95,037 units). The going seems to be getting tougher as production at four plants – Manesar (Haryana), Tapukara (Rajasthan), Narsapura (Karnataka) and Vithalapur (Gujarat) – will remain suspended until May 15, and the company will use this period for annual maintenance work. The combined manufacturing capacity of the four plants is 6.4 million units per annum. However, the two-wheeler maker’s exports breached the 40,000 units mark for the first time in 36 months in April at 42,945 units. The company is keeping a close watch on the COVID-19 situation and the evolving business landscape, and will review restarting operations accordingly in the short-term. TVS Motor Co: 1,31,386 units Sales for Chennai-based TVS Motor was also weighed down by the COVID-induced lockdown and a drop in demand. It registered sales of 1,31,386 units in the domestic market in April, down 35 percent from March (2,02,155 units). It has exported a total of 94,807 units in April. Bajaj Auto: 1,26,570 units Pune-based Bajaj Auto, India’s No. 1 motorcycle and two-wheeler exporter, has opened FY2022 on a strong note. Last month, the brand clocked worldwide sales (including India) of 3,48,173 units, of which 2,21,603 units – or 63 percent – were exported. In the COVID-impacted FY2021, Bajaj Auto had shipped 17,96,518 units, down 3.9 percent year-on-year (FY2020: 18,69,220). However, seen in terms of month-on-month growth, it can be clearly seen that strong 49 percent export growth in April 2021 over March 2021 has helped the company as domestic sales were down 30 percent last month. Bajaj Auto, the world’s third largest motorcycle maker, leads Indian automobile exports, accounting for almost 60 percent of the country’s motorcycle and three-wheeler exports last year. The company will be investing Rs 650 crore in a fourth plant in Chakan, Maharashtra, for its premium motorcycle brand portfolio and the Chetak electric scooter, to support the rising demand for its products globally. Royal Enfield: 48,789 units Chennai-based Royal Enfield sold around 48,789 units in April 2021, down 19 percent from March sales (60,173 units). It also exported around 4,509 units. Suzuki Motorcycle India: 63,879 units Suzuki Motorcycle India (SMIPL), the two-wheeler subsidiary of Suzuki Motor Corporation, Japan, recorded 63,879 units sold in the domestic market, up 6 percent from the 60,222 units sold in March. It has also exported 13,970 units in April. The company launched the new Hayabusa in April and the first batch of 101 units was spoken for within two days of bookings opening. Growth outlook Given the on-ground situation in the country, which is grappling with the unprecedented COVID-19 pandemic and has a growing number of states having imposed lockdowns, there is no doubt that May 2021 is set to be a month of poor sales for the two-wheeler as well as other vehicle segments. The worry for automakers will be if the lockdowns extend beyond May. Furthermore, in what is a huge dampener to two-wheeler sales, is the shutting down of the big-ticket Delhi-NCR market amid the wedding season, which has begun in India this May and extends for a couple of months. It is well known that a large number of two-wheelers, mainly motorcycles, are gifted to grooms and dealers are often hard-pressed to cater to demand. This year, the scene is very different and inventory levels are rising, which will have a ripple effect on the industry's fortunes. SRICHARAN R Also see: Honda two-wheelers to halt production at all four factories Hero to suspend manufacturing operations at all 5 factories
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