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Re-opening of offices, institutions to boost two-wheeler sales

Re-opening of offices, as well as educational institutions, is expected to give a boost to two-wheeler sales volume on a sequential basis.

Accordingly, the sequential improvement is expected to sustain in February 2022, supported by a gradual easing of the supply-side constraints, re-opening of offices and colleges, as well as relaxation in travel restrictions and the measures announced in the FY23 Union Budget.

However, on a year-on-year (YoY) basis, the segments’ sales were dented in January 2022 due to lower rural demand, staggered state-wise restrictions amid the third wave of Covid-19, and production constraints in the premium two-wheeler segment.

“While domestic ‘2W’ sales volume continued to be 21 per cent YoY lower in January 2022, it grew 12 percent, MoM, sequentially after declining for three consecutive months, with growth noted across scooters and motorcycles,” India Ratings and Research (Ind-Ra) said.

“Scooters outperformed motorcycles in January 2022. mainly due to a lower base in December 2021.”

Besides, it pointed out that the limited impact of the third covid wave on economic activities and relatively relaxed restrictions compared to prior waves also supported the MoM growth.

“Dealership inventory decreased further to 25-30 days in January 2022. A2W export sales grew 3 percent MoM and declined 3 percent YoY in January 2022.”

“Ind-Ra expects the sequential improvement to sustain in February 2022, supported by a gradual easing of the supply-side constraints, re-opening of offices or colleges, relaxation in travel restrictions coupled with a likely improvement in rural offtake due to better crop production and the measures announced in the FY23 Union Budget.”

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