While sales of passenger vehicles seem to have revived during August and September on the back of pent-up demand as a result of the lockdown, the same level of revival is not seen in the sale of two-wheelers. According to dealers, during the nine-day Navaratri festival PV sales were brisk, but sale of two-wheelers were tepid and the industry is estimating that on a y-o-y basis the fall is in double-digit. Analysts tracking the auto sector feel this trend could be because the two-wheeler sector has not seen launches of new models or variants, which generally spurs consumer interest. A section of consumers may have graduated to smaller cars like Maruti Suzuki’s Alto, sales of which have witnessed good growth. This section may also have moved to buy used cars.
As per the Society of Indian Automobile Manufacturers (Siam) data, during July-September while PV sales grew 17.02% (7,26,232 units over 6,20,620 units in Q2FY20), those of two-wheelers remained almost flat at 0.17% (46,90,565 units over 46,82,571 units), despite pent-up demand in both the segments being more or less similar. During July-September quarter for instance, sales of Alto grew 26% (46,297 units, over 36,779 units in Q2FY20).
“Unlike in two-wheelers, new model launches pushed sales substantially in PVs,” says Sanjeev Garg, practice leader, automotive, Praxis Global Alliance. “There have also been a lot more new PV launches this year (compared to those of two-wheelers),” he said. Garg added that post-lockdown, institutional buying in the two-wheeler segment is yet to pick up. “We foresee increased institutional sales of two-wheelers in the coming months,” he says. Food delivery companies such as Swiggy and Zomato are yet to reach pre-Covid-19 order value, but they are getting there. On October 22, Swiggy said its pan-India food delivery has recovered to 80-85% of pre-Covid-19 order value, while in ‘many markets’ it has returned to 95%. Also, recovery for the overall food delivery market, according to a Zomato analysis till September, clocked over 85% of pre-Covid-19 gross merchandise value, up from over 75% in August.
Post-lockdown, while initial sales growth (first negative and then positive) was more favourable for two-wheelers than for PVs, it started turning around in July. According to Siam, in June 2020, two-wheeler sales saw a decline of 38.56% and for PVs the decline 49.59%. In July, two-wheelers saw a decline of 15.24% but PVs narrowed the fall with a decline 3.86%. In August, while two-wheeler sales grew just 3%, those of PVs shot up to 14.16%. And in September, two-wheelers grew 11.64%, while PVs at 26.45%.
According to Som Kapoor, partner, automotive sector, EY India, as India gradually unlocked and people started moving out, entry-level cars and used cars may have attracted a section of prospective two-wheeler buyers. “People are definitely moving to personal mobility, and within personal mobility there’s a preference for pre-owned as well as entry-level cars; people have used the pandemic to increase personal mobility and a lot of them believe that the safety net in a four-wheeler is much better than in a two-wheeler,” he says. He adds a reason that entry-level cars have seen huge growth is also because there is a generation of young buyers who would have otherwise missed buying their first car — as they preferred ride-sharing —and that generation is ending up buying a car.
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