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MOSL: AUTOMOBILES-Scooter sales decline for the first time in FY19; 125cc segment sales grew ~48% in FY19

AUTOMOBILES: Scooter sales decline for the first time in FY19; 125cc segment sales grew ~48% in FY19, while 110cc declines for the first time

 

We analyzed the brand-wise data of the domestic 2W industry; we learnt that the 2W industry in India grew at 4.9% in FY19. For the first time in many years, motorcycle growth at 7.8% outpaced scooter sales, which declined 0.3% in FY19. This led to a decline in share of scooters by 160bp to 31.6%. Growth of 7.8% in motorcycle sales was led by the economy segment, which grew ~23% for the second consecutive year, whereas the premium segment grew 8.8%.

• In FY19, for the first time, motorcycle sales growth at 7.8% outpaced sales of the scooter segment, which declined 0.3%, leading to share of scooter declining to 31.5% (v/s 33.1% in FY18). The exit month scooter share also declined to 26.7%.
• The decline in the scooter industry was restricted by the 125cc category, which is estimated to have grown ~47% in FY19 (~25% contribution to scooters), whereas the 110cc category witnessed a decline for the first time of ~10%.
• Rural recovery and price actions by Bajaj drove healthy growth in the economy segments, which grew ~23% in FY19 (+23% in FY18). While the premium segment grew ~9% (premium ex-RE grew ~12%), the executive segment was flat.
• BJAUT gained significant share in the economy segment (+670bp), but it came at the expense of TVSL (-310bp) and HMCL (-360bp).
• Unlike previous years, the growth in the premium segment at 8.8% in FY19 was driven by growth in non-RE brands, which grew by 11.3% (led by Apache, Pulsar and Xblade). RE grew 14.8% during the same period.