1. As Ganesh Chaturthi kick-starts festive season, inventory volumes at 2-wheeler dealers soar; Honda leads

As Ganesh Chaturthi kick-starts festive season, inventory volumes at 2-wheeler dealers soar; Honda leads

According to industry sources, retail volumes rose by about 9-10% while the increase in wholesale volumes was 26%, as reported by two-wheeler manufacturers.

By: | Updated: September 7, 2016 6:47 AM
two-reu-L The level of inventory volumes were also confirmed by dealers that FE spoke to but are not surprising given the festive season has begun with Ganesh Chaturthi being celebrated on September 5. (Reuters)

While wholesale volumes for two-wheelers saw a reasonably robust increase in August, retail sales of motorcycles and scooters were a shade more subdued, reports Malyaban Ghosh in Mumbai. According to industry sources, retail volumes rose by about 9-10% while the increase in wholesale volumes was 26%, as reported by two-wheeler manufacturers.

According to analysts tracking the automobile sector at IIFL, inventories with dealers are at levels of six to eight weeks compared with levels of three to four weeks in August. “Our checks across two-wheeler dealerships reveal that inventory levels have seen a sharp uptick in recent months,” they wrote.

The level of inventory volumes were also confirmed by dealers that FE spoke to but are not surprising given the festive season has begun with Ganesh Chaturthi being celebrated on September 5.

Honda Motorcycles and Scooters India (HMSI) has been ahead of other OEMs, pushing in scooter inventory since the commencement of its new plant in Gujarat in early 2016.

“Our network, especially the last-mile network, usually missed the opportunity to sell in festivals on account of demand versus supply gap. This year, Honda has planned in advance to avoid stock-out situation on festival days as experienced in earlier years,” said YS Guleria, senior vice-president, sales and marketing, HMSI.

“Although retail sales have been somewhat on the lower side in August, we expect to sell significantly more in the next two months,” said a dealer of HMSI located on the outskirts of Mumbai.

Hero MotoCorp — India’s largest two-wheeler manufacturer — has also been pushing inventories across the country as the company expects a healthy increase in volumes for its economy and executive segment motorcycles and scooters on the back of a good monsoon and higher salaries for government employees following the Seventh Pay Commission’s recommendations.

In the April to August period, retail volumes in the two-wheeler segment grew 10% compared with 3% in the corresponding period of FY16.

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