20 June 2013

India Two-Wheelers Scooter Mania :: JPMorgan

 India has amongst the lowest proportion of scooters in two-wheeler sales:
While scooters comprise 84% of industry sales in the ASEAN region, Europe is
at 63% while India lags at 21%. What is changing in India: As urbanization
levels increase, more women take to driving, fuel efficiency of scooters increase
and the per capital income rises, the penetration of scooters will increase in the
overall product mix, in our view. Negative for incumbents: Hero Motocorp
and Bajaj Auto are market leaders in the motorbike segment, while Honda is
dominant in the scooter segment. As the proportion of scooters increases in the
overall mix, the local OEMs will likely cede share.
 Scooters – global trends: In the ASEAN markets, scooters / step-throughs are
priced lower than motorbikes; further within scooters, the automatic range now
constitutes 60% of overall sales (compared to 8% in 2006). In Europe, scooters
form a majority proportion of less than 150cc two-wheeler segment. In India, the
scooter segment primarily consists of the gearless / automatic range – a large
proportion of users are women, with OEMs launching models specific to that
category.
 Reasons for low scooter penetration in India: The lower price points of entry
level bikes, higher fuel efficiency of motorbikes as well as higher ground
clearance, which makes it easier to navigate rough roads (particularly in rural
belts) are the key reasons for the dominance of motorbikes.
 What is changing: As urbanization levels increase, more women take to
driving, fuel efficiency of scooters increase and per capita income rises, the
penetration of scooters will increase in the overall product mix, in our view. As
Hero and Bajaj Auto have a limited presence in this segment, we believe the
Japanese OEMs will benefit. We expect scooters to gain share from executive
segment motorbikes. While Hero Motocorp has overall market share of ~43%, it
has a limited market share of 19% in the scooter segment. Similarly, Bajaj Auto
has an overall market share of 18% with its dominant presence in the motorbike
segment (the OEM is not present in the scooter segment). While Honda has an
overall two-wheeler market share of 19%, it commands a share of 49% in the
scooter segment
�� -->

No comments:

Post a Comment