Motorcycle sales under pressure this December

Mumbai: Motorcycle manufacturers are likely to close December 2007 with their numbers under pressure, mainly on account of restricted lending by banks.

Reports indicate Hero Honda's motorcycle sales to be in the region of 2.3 lakh units, with Bajaj Auto following just behind at around 1.8 lakh. TVS Motor is reported to be close to ending 2007 with a little over 50,000 bikes sold.

Hence, total sales of the top three companies will notch up only 4.6 lakh motorcycles, compared to 5.5 lakh units in November, and 6.7 lakh in October, where sales skyrocketed on account of the festive season.

Sources say since the Reserve Bank of India (RBI) directed banks not to indulge in strong-arm tactics for recovering delinquent loans, banks have preferred not to lend in the first place, to avoid collection issues. This has been compounded by the fact that the 'model' of a vehicle registered changes in January, which affects its resale value, prompting customers to postpone their purchases in December, which shows directly in the watered down sales numbers of motorcycle companies.