Bajaj Auto expects India’s two-wheeler industry sales to grow in the high single digits during the current financial year while electric two-wheeler sales growth is projected in the 'high teens' amid disruption caused by the changes in electric vehicle subsidy.
Growth in the two-wheeler industry is seen at 7-8 percent year-on-year, driven by higher sales in the 125 cc + segment with entry-level motorcycles remaining under pressure, according to Bajaj Auto Executive Director Rakesh Sharma.
“We feel that growth in the financial year 2025 will be somewhere around 7-8 percent. Growth in 100cc bikes will be much lower and 125cc + would be much faster,” he told reporters in a post-earnings call today.
Though the industry sales remain below the all-time high of 2018-2019, there have been some green shoots since last year. Better disposable income, infrastructure, recovery from pandemic worries, favorable weather conditions, and e-commerce activity have boosted consumer sentiments.
As per the data from the SIAM, India’s two-wheeler sales rose 13.3 percent on year to 1.80 crore units during the financial year 2024. Motorcycles grew 13.9 percent to 1.17 crore units, while scooter sales rose 12.5 percent to 58.39 lakh units.
Bajaj Auto clocked a 25 percent on-year growth in its domestic two-wheeler sales in FY24 with 22.51 units. The company expects its growth in the current year to be higher than the previous one with four-six new launches planned that include a new mass-market Chetak model, CNG bike and Pulsar 400.
Meanwhile, the sales of electric two-wheelers are seen moderating to 'high teens' after a 28 percent growth in the previous financial year. This moderation comes amid disruption caused by the correction and uncertainty in the demand subsidy given by the government on the sales of electric two-wheelers.
“If I were to hazard a guess, I would say electric two-wheelers would continue to grow at good double-digit rates. It was 28 percent last year, it may not be 28 percent. But certainly will be in the high teens or so,” Sharma said.
He noted that people have advanced their purchases to March as the subsidy changed from April 1, and there could be a fall-off in April. “The real impact of the reduction in subsidy will be probably known in June or July. But we will again see this phenomenon of advancement that time because the EMPS scheme will conclude,” Sharma said.
The automaker, however, expects electric two-wheeler sales to outpace the sales of scooters powered by internal combustion engines and it will cannibalise the ICE scooters.