For the past two to three years, the motorcycle market in India has witnessed how there is a beeline for luxury motorcycle makers and premium manufacturers coming into the country. The number is now twice as many in comparison to the motorcycle makers that are focusing on the mass market appeal. India is known all over the world as the top two when it comes to the two-wheeler market. This is also the reason why the business for motorcycle clothing store has blossomed in the country.
It must also be obvious that the mass motorcycle makers are already moving into new directions by developing premium motorbike models that are quite beyond their usual scope. The country is known to sell around 20 million motorcycles annually.
When you talk about premium in India, it refers to motorcycle models that have 200 cc and beyond. The sector is currently dominating only almost 7 in the entire domestic market. This is why there is a big question mark as to why manufacturers are flocking to the market with very little chance of growth.
According to the senior group VP at the ICRA Limited which is a rating firm, Subrata Ray, the sub-sector actually rakes in more profit because of the premium pricing with motorbikes that are highly displaced. There is proof in the number of different OEMs. Looking at the low volume of the said sub-sector versus the entire two-wheeler market shows that the possibility of expansion may not be possible.
The statement was further backed by Siddhartha Lal who is the leader of Royal Enfield. He said that their profit margins are 1.5 times higher compared to the entire industry and even higher in comparison with the motorcycle products. Their current profit share in the country’s market is between 18 and 20 per cent. This means that Royal Enfield earned one of every Rs 5 profit in the motorcycle industry.
There are new brands that came into the country including MV Augusta, Benelli and Indian which puts the current number of premium motorcycle makers at 11. This is almost twice as much as the mass segment makers of two-wheeler which stands at only six. The market for motorcycle clothing store is also booming because of the continued in increase in demand for motorcycles in the country regardless if premium or mass market.