Mumbai: Change is the only constant in India's burgeoning two-wheeler automobile industry.
Riding on the back of the success of new motorcycle launches, relatively smaller two-wheeler manufacturers, notably LML, TVS Motor Company and Yamaha India, have succeeded in making a dent in the market shares of big players like Hero Honda and Bajaj Auto in the month of January 2003.
What makes everyone happy is that the sales of motorcycles of all makes continued to increase; scooters and mopeds remained in the negative territory, though.
According to figures released by the Society of Indian Automobile Manufacturers (SIAM), in January 2003, LML and TVS Motor Company showed a sales growth of 198.7 per cent and 32.5 per cent, respectively.
Bajaj Auto showed a 19.8-per cent sales growth, selling 75,059 units of motorcycles against the sales in the corresponding period in January 2002. This is significantly lower than its growth of 37 per cent in the 10-month period of April 2002-January 2003.
The leader of the pack, Hero Honda, reported a miserly sales growth of 6.6 per cent. Yamaha, Kinetic Engineering and Royal Enfield Motors are yet to announce sales figures.
TVS sold 61,223 bikes in January 2003 as against 46,187 bikes in the same period last year and its cumulative bike sales between April 2002 and January 2003 were up by almost 72 per cent at 6.01 lakh units, over the corresponding period of year 2002. TVS also reported a 32-per cent rise in scooter sales in January, at 12,947 units, improving its April-January sales to 1.33 lakh units.
LML reported an astonishing rise in sales of 14,477 units in January 2003, up from 4,846 units in the same month last year, while its total motor bike sales between the April-January period touched 83,001 units (38,418 units during April-January last year).
According to the company, the growth in motorcycle sales has come almost entirely from the sales of the Freedom; the bike's huge success has turned the company's fortune. Company officials say in the future it intends to increase the production capacity for motorcycles, and will also introduce a greater number of motorcycle models.
TVS Motor Company's sales growth has been on the back of its best-selling four-stroke motorbike Victor, which helped the company triple its net profit for the third quarter ended 31 December 2002.
The total turnover of the company in the first nine months of 2002-03 touched Rs 2,054 crore, registering a 50-per cent improvement over the corresponding period last fiscal (Rs 1,369 crore).
TVS plans to launch a motorcycle with a totally different engine and design, by May 2003, the name of which has not been disclosed yet. It hopes to sell close to 20,000 units of the new bike per month.
Also on the anvil is a totally new Fiero, a 150cc four-stroke bike, with better styling and better handling. The company is also planning two new models of the Victor, a more stylish and sleeky version and a more rugged version, by March 2003.
Bajaj Auto, the No 2 player, showed a relatively mediocre performance in January even as its newly launched motorbike, Byk, the cheapest four-stroke model on sale in India, sold almost 6,000 units in January, the second month since its launch.
Auto analysts attribute the drop in growth rates to the company's high motorcycle sales in the second half of fiscal 2002, and a partial effect of drought conditions, especially in rural markets.
The analysts add that the bikes, which Bajaj developed indigenously, have begun to outpace the growth of the Kawasaki range of bikes it sells in India. In January 2003, Bajaj's two indigenously developed products - Pulsar and Byk - contributed over 38 per cent of its total bike sales.
Hero Honda, the leader of the market with its highest-selling Splendour range of bikes, reported sales of 1.45 lakh vehicles during January against 1.37 lakh vehicles in January last year and achieved cumulative sales of 14.27 lakh units by the end of January this fiscal against 11.63 lakh.
While the demand for motorcycles has been quite robust, Hero Honda Motors, the leader of the pack, has not been able to capitalise on this trend. The company's recent product launches have not bought in the volumes for the company, resulting in the company's sales lagging behind the overall growth rate for the motorcycle market.
All are not rosy
Even in the last festival period season (October and November) the company showed a lacklustre volume growth. However, despite the fall in market share, Hero Honda Motors continues to be the leader in the motorcycle market. Its market share is roughly estimated at 44.5 per cent in January from about 50.7 per cent in the same period previous year.
During the nine months of 2002-03, the total motorcycle sales grew by about 39.7 per cent while Hero Honda has managed a 27.5-per cent improvement during the period.
The analysts say Hero Honda is slowly losing its earlier scorching pace even as its tie-up with Honda is increasingly becoming uncertain. Growing competition from Bajaj Auto, TVS Motor and Yamaha has eaten into the market share of Hero Honda. While the new product launches like the Pulsar and the Victor from Bajaj Auto and TVS Motor, respectively, proved to be a hit, Hero Honda is yet to come up with a successful model to regain the market share.
Though the launch of the Passion did bring in the volumes, its other offering, the Dawn, was not a big success. Also, the 133cc model Ambition, launched more recently, has yet to see significant volume sales.
SIAM says Hero Honda's sale volume, of motorcycles with an engine capacity of over 125cc (consisting primarily of the CBZ and the Ambition), dropped to 11,281 units from 12,887 units at the end of the last year. Yamaha Motors India last year achieved a dramatic turnaround on the back of the success of its 125cc Enticer and 106cc Libero models.
The company's Enticer bike model is fuelling growth for the company, which has cashed in on the winning formula of fuel economy plus power along with an irresistible price of Rs 49,000.
The company plans to launch two variants of the Enticer in 2003 since there is a huge demand in this segment, according to company officials. Till December 2002, the Enticer notched up 35,000 units in sales since its launch, while the Libero sold 15,000 units since its launch in October 2002.
Kinetic, which recently launched the cricket-inspired bike Boss, is also focusing a great deal more on motorcycles. The company plans to launch a new 165cc motorcycle in March 2003 and a 115cc motorcycle in the first quarter of the next year as part of its plans to introduce a new motorcycle in every quarter during the next one year.
According to the company, the GF 165cc motorcycle would be introduced in two variants - City and Sports - and would be produced as part of Kinetic's existing technical alliance with Korea's Hyosung Motors. Another 115cc motorcycle, the Velocity, will also be out in the first quarter of the next year, the officials add.
Besides this, Kinetic plans to launch a 250cc completely imported motorcycle, the Aquila, in March 2003. Kinetic recently displayed the 250cc Aquila at the Bombay auto expo.
The Aquila 250 is a true cruiser bike with a 250cc engine priced at more than Rs 1 lakh. Kinetic believes that it will be the best available motorcycle in the country and the only real, true-blue cruiser.
Watch out for more two-wheeler action on our roads.