Two-wheeler industry to grow by 9% in 2014-15

  • Oct 15, 2014
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Credit rating agency ICRA has said in a report that the Indian two-wheeler industry is set to grow about 9 per cent in 2014-15

100-110 cc commute bikes

Volumes in the short term are expected to draw support from replacement demand and this is the main reason for the growth, ICRA said in its report.

Over the medium term, the industry is expected to report a compounded aggregated growth rate, or CAGR volume of about 9 per cent to reach 23 million units (both domestic and exports) by 2016-17, the ICRA report said.

In its fastest pace of growth since 2010-11, the two-wheeler industry recorded strong growth with sales volumes expanding by 14.8 per cent year-on-year in the first five months of the current fiscal. Not surprisingly, the primary driving force behind the overall two-wheeler industry in the last three years has been strong demand for scooters.  In fact, scooters contributed as much as 27 per cent to the domestic two-wheeler industry during the first five months of 2014-15.

The report said that the motorcycle segment’s contribution too has gained forced in the current fiscal, owing to greater replacement demand and new model launches by various original equipment manufacturers (OEMs).

Two-wheeler industry growth in the near future is expected to be a combination of both domestic sales and exports. ICRA said this would be on account of several structural positives such as favourable demographic profile, under-developed public transport systems, growing urbanization, strong replacement demand and moderate share of financed purchases. A significant contributor to the Indian two-wheeler industry will be exports, primarily in the large opportunity available in overseas markets such as Africa and Latin America, ICRA said in its report.

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