After passenger vehicles and commercial vehicles, two-wheeler manufacturers have reported declining sales in March amidst the lockdown in the latter part of the month. Leading two-wheeler makers — Hero MotoCorp and TVS Motor Company — saw a steep fall in their sales during the month. While Hero MotoCorp reported a decline of 42.42%, TVS Motor saw sales plummeting by 55.5%. The Federation of Automobile Dealers Associations (FADA) recently expressed its serious concern over the dwindling retail sales of two-wheelers as compared to other segments. Analysts, who held conference calls with dealers, claimed that there were nearly 500,000 units of BS IV two-wheelers still in their possesion.
Even the recent Supreme Court order relaxing the sale of 10% of the total inventory for 10 days after the lockdown, which is expected to be around April 15, will not bring any cheer to the two-wheeler makers. Two-wheeler industry has been under sales pressure over the past few months due to high insurance cost, poor consumer sentiment, particularly in the tier-II, III cities. Hero MotoCorp said that its March sales declined sharply 42.42% to 334,647 units. On the other hand, TVS Motor’s March sales plummeted 55.5% to 144,739 units. Similarly, for the fiscal ended March 2020, Hero MotoCorp reported a 11.5% decline in its total sales to 64,09,719 units, while TVS Motor’s sales declined 21% to 32.45 lakh units.
Hero MotoCorp said that during March 2020, the auto industry and the entire global economy faced with an unprecedented disruption, owing to the novel coronavirus. The Covid-19 has resulted in interrupted supply chains, halted production and lockdown, leading to no retails. With Covid-19 situation escalating through March, Hero MotoCorp set up a Business Continuity Task Force and pro-actively rolled out a slew of measures to ensure health and safety of its employees and business partners. On March 22, the company proactively suspended production at all its manufacturing facilities – including in India, Colombia, Bangladesh and Global Parts Centre (GPC) at Neemrana until April 14, 2020.
TVS Motor said that there had been a huge impact on the production and sales in March 2020 because of Covid-19 lockdown across the country. The company launched attractive and feature rich BS VI versions of its entire portfolio. These have been well received and there are adequate stocks already in the market when it reopens. International market demand was also good for both two-wheeler and three-wheeler categories. However, due to the lockdown, there was a significant setback in production, and also vehicle stock in the factory for both domestic and international markets, which could not be dispatched.
According to the company, it started the transition to BS VI in Q3 of FY19-20 and this effective planning helped in complete readiness of BS VI vehicle supplies in Q4. The company, including its dealers, has almost entirely retailed all BS IV vehicles and the company is fully geared up for its BS VI range once the market opens.
