The two-wheeler industry which had shown a good deal of growth until now is under speculation. Is the growth the true reflection of the two-wheeler market conditions? Well, quite a few companies do not agree with this. According to Bajaj Management, the companies have been billing more than what has been sold by the retailers. However the management also claimed that they do not follow such practices and if the other motorcycle makers too had billed the right numbers, the growth of the two-wheeler segment would have shown a negative trend.
With such conditions, the day would not be far when the two-wheeler market joins the four-wheeler segment and shows a decline in sales. The manufacturers have started to see the trend declining as customer’s demand is slowing. The inventories are piling up and this has forced the companies to cut down the production. One reason for the fall in demand could be the hike in fuel prices. But the sector also faces threat from the delayed monsoons. The manufacturers are just hoping that the demand would soon be back in place with the fast approaching festival and wedding season.
Coming to the production cuts, people close to the development say that the vendors to Bajaj Auto’s Pantnagar plant, which manufactures variants of Discover and Platina bikes, have already been asked to cut down on supplies. However, K. Srinivas, President of Bajaj’s Motorcycle Business, has denied the production cut. Hero MotoCorp is also suffering from high inventories and is likely to cut down production by almost 20 percent. All the above factors have adversely affected the sales of two-wheelers in both the rural and urban markets.
Figures from The Hindu Business Line
Source – Business Line