Lockdown Recovery: Two-wheeler sales pick up in June 2020, Hero MotoCorp sold over 4.5 lakh units

Demand recovery was largely driven by a personal vehicle preference along with high disposable income in the rural market due to a good harvest, according to analysts. The overall volumes were resilient with a minimum decline in the range of 27-35% in June for the major players, picking up from the nil domestic retail sales in April and the subsequent slow sales in May 2020.

The country’s two-wheeler companies have reported decent sales in June, primarily riding on rural recovery and pent-up demand. Demand recovery was largely driven by preference for a personal vehicle over public transport and high disposable income in the rural market due to a good harvest, analysts who track the sector said. The overall volumes were resilient with a minimum decline in the range of 27-35% in June for the major players, picking up from the nil domestic retail sales in April and the subsequent slow sales in May. In June, Hero MotoCorp sales declined by 27%, Bajaj Auto 29%, TVS Motor 33% and Royal Enfield 35%, an analysis by Motilal Oswal said. Good retails and supply-side issues resulted in extremely low inventory for two-wheeler makers, it added. Hero MotoCorp has led the revival of the domestic two-wheeler sector in June with wholesale deliveries made to dealerships of over 450,744 units – a record sequential growth of four times over the 112,682 units dispatched in May 2020. Compared with June 2019, the sales saw a drop of 26.86% compared with its sale of 616,256 units in June last year.

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Hero MotoCorp chairman & CEO Pawan Munjal said: “ A major part of the market demand is emanating from the rural and semi-urban markets, which have been helped to a large extent by the various stimulus packages rolled out by the government. A combination of multiple factors, including the forecast of a normal monsoon, a bumper rabi crop and the upcoming festive season are expected to keep the momentum going over the next few months.”

TVS Motor two-wheelers registered sales of 191,076 units in June this year against 283,461 units in June 2019, down by 32.6% year-on-year (y-o-y). TVS Motor resumed its operations in a graded manner across its factories in Hosur, Mysuru and Nalagarh. “The company faced supply chain constraints in June, but it has undertaken various counter-measures, some of which have started yielding results in June itself. The company is expecting to overcome these in July,” a statement from the company said. Overall, TVS Motor domestic two-wheelers registered sales of 144,817 units in June 2020 against 226,279 units in June 2019, declining by 36%.

Bajaj Auto’s domestic sales in June 20 stood at 146,695 units against 199, 340 units in June 2019, recording a drop of 26% y-o-y. Overall, the total two-wheeler sales in June 2020 stood at 255,122 units against 351,291 units. Royal Enfield posted a sale of 38,065 motorcycles in June 2020 against 58,339 for the same month last year, registering a decline of 35%. Out of this, 36,510 units were sold through domestic retail sales against the figure of 55, 082 units in June 2019.

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