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Business Standard
3 hours ago
- Automotive
- Business Standard
Two-wheeler sales may cross pre-Covid levels in FY26 on export rebound
India's two-wheeler industry is expected to cross its pre-Covid peak in FY26, with sales volumes projected to grow by 8–9 per cent, according to a new report by CareEdge Ratings. This follows an 11 per cent growth in FY25, driven by robust domestic demand and a strong rebound in exports. Despite a high base and headwinds like the implementation of the new OBD-II Phase-B emission norms, the overall outlook remains upbeat. Factors such as easing inflation, improved rural sentiment, rising disposable incomes—helped by new tax rebates for individuals earning up to ₹12 lakh annually—and a cumulative 100 basis points (bps) interest rate cut by the Reserve Bank of India (RBI) since February are expected to bolster demand. 'The two-wheeler industry is set to vroom past pre-Covid levels in FY26, aided by strong export momentum, rising EV penetration, and improved affordability,' said Madhusudhan Goswami, Assistant Director at CareEdge Ratings. In FY25, India's two-wheeler industry recorded 11 per cent overall volume growth, driven by a 9 per cent rise in domestic sales and a robust 21 per cent recovery in exports. Scooter sales led the growth trajectory with a 17 per cent increase, while motorcycle sales grew steadily by 9 per cent, reflecting sustained demand across segments and geographies. Volume growth has remained steady over the last three years — 8 per cent in FY23, 10 per cent in FY24, and 11 per cent in FY25. Notably, rural India contributed 58.3 per cent to total retail registrations in FY25, up from 57.9 per cent in FY24. Scooters have led the growth curve, registering three consecutive years of double-digit expansion — 26 per cent, 13 per cent, and 17 per cent. While motorcycles continue to dominate volumes due to their fuel efficiency and affordability, scooters are rapidly gaining ground in urban markets. Electric two-wheelers (E2Ws) are also emerging as a key contributor. E2W sales hit 1.2 million units in FY25, accounting for around 5 per cent of total two-wheeler volumes. The segment grew 29 per cent in FY24 and 19 per cent in FY25, reflecting growing consumer acceptance. In FY25, entry-level motorcycles held a 72 per cent share of the market, registering 8 per cent year-on-year growth. Executive motorcycles made up 20 per cent of sales and grew 12 per cent, while premium motorcycles held an 8 per cent share, growing 10 per cent during the year. This reflects a gradual diversification in consumer preferences across price points. Though entry-level motorcycles remain the volume driver, their share has declined from 75 per cent in FY19 to 72 per cent in FY25. A recovery has been visible since FY23, supported by improved rural demand and affordability. Executive and premium motorcycles are gaining traction, supported by aspirational urban buyers and a slew of new model launches. This trend signals a maturing market with more diverse consumer preferences. Exports, which accounted for 18 per cent of total volumes in FY25, are expected to rise by 12–14 per cent in FY26. This rebound follows stabilisation in key African and Latin American markets that previously faced inflation and currency pressures. Arti Roy, Associate Director at CareEdge Ratings, said: 'The domestic market may see a slight moderation in growth due to a higher base, but exports and EVs will help sustain overall momentum. While manufacturers remain optimistic, data from the Federation of Automobile Dealers Associations (FADA) indicates cautious optimism among dealers. Dealers expect mid- to high single-digit growth in FY26, supported by festive demand and new launches. However, concerns remain around tight credit norms, lingering consumer caution, and the potential impact of global tariff tensions on investor sentiment and disposable incomes. Month-on-month retail sales rose 11 per cent in May, buoyed by Gudi Padwa and Eid. However, year-on-year sales dipped 1.7 per cent, reflecting subdued sentiment and pre-buying slowdowns ahead of OBD-II Phase-B price hikes. Additional pressure points include low footfalls, rising operating costs, over-expansion of dealer networks, and intensifying competition from electric vehicle startups.
India Gazette
7 hours ago
- Automotive
- India Gazette
Rate cut by RBI will boost 2-wheeler sales in FY 2026: CareEdge Ratings
ANI 09 Jun 2025, 15:46 GMT+10 New Delhi [India], June 9 (ANI): India's two-wheeler industry is poised to surpass pre-COVID-19 sales levels, with an anticipated volume growth of 8-9 per cent in fiscal year 2026 (FY26), fuelled by rate cut by Reserve Bank of India ( RBI), a substantial recovery in exports and robust domestic demand, according to a report by CareEdge Ratings.'The cumulative 100 bps rate cut by the RBI since February 2025, with the recent 50 bps rate cut announced last week, is expected to enhance affordability and boost demand,' said Madhusudhan Goswami, Assistant Director at CareEdge the past three fiscal years, the Indian two-wheeler industry has demonstrated healthy volume growth of 8 per cent in FY23, 10 per cent in FY24, and 11 per cent in FY25. The FY25 growth was particularly bolstered by a 21 per cent export recovery and a 9 per cent rise in domestic volumes. However, domestic volumes saw a rise, supported by an uptick in rural demand and sustained urban added, 'While domestic two-wheeler sales growth may moderate slightly due to a higher base, strong export momentum and rising EV adoption will help to sustain overall industry volume growth.' Key factors projected to drive demand include easing inflation, increased disposable income from a full income tax rebate for individuals earning up to Rs 12 lakh per annum, and a more accommodating monetary policy, highlighted by the RBI's cumulative 100 basis points rate cut since February 2025. A favourable monsoon is also expected to further strengthen growth scooter segment has shown strong performance, recording double-digit sales growth for three consecutive years ending March 2025, with increases of 26 per cent in FY23, 13 per cent in FY24, and 17 per cent in FY25. Scooter sales are expected to remain healthy and outpace motorcycle sales growth in FY26. However, Motocycles is the most consistent two-wheeler segment. In FY25, motorcycle volume grew by 9 per cent, while scooter sales grew by 17 per cent. 'This growth trend is expected to continue in FY26. Motorcycles remain popular due to their fuel efficiency, cost-effectiveness, and versatility, while scooters have gained traction, especially among urban commuters,' CareEdge said in a release. (ANI)
Time of India
8 hours ago
- Automotive
- Time of India
Two-wheeler volumes likely to grow by 8-9% in FY26: Report
Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Popular in Auto 1. Popular urban bikes lose traction on slowdown hit Domestic two-wheeler volumes are expected to grow 8-9 per cent this fiscal, surpassing the pre-COVID levels, driven by a host of factors including easing inflation and prospects of a favourable Monsoon among others, a report said on report by CareEdge Ratings also noted that the domestic two-wheeler industry has maintained a healthy volume growth of 8 per cent, 10 per cent, and 11 per cent in FY23, FY24, and FY25, growth in FY25 was supported by a substantial 21 per cent export recovery and a 9 per cent rise in domestic volumes. The export recovery was due to stabilisation in key markets affected by inflation, high interest rates, and currency issues in earlier years, it volumes were supported by a substantial uptick in rural demand and sustained urban demand, CareEdge said."Two-wheeler sales are set to maintain strong momentum in FY26, building on a robust FY25 performance. Despite a high base and a modest 1-2 per cent price increase due to the implementation of OBD-II Phase-B norms, the industry is well-positioned for 8-9 per cent volume growth in FY26," it said."CareEdge Ratings anticipates that the two-wheeler industry is set to vroom past the pre-COVID levels in FY26 with healthy volume growth of approximately 8-9%, aided by export volumes accelerating at 12-14 per cent and domestic sales volumes maintaining a steady 6-8 per cent rise," said Madhusudhan Goswami, Assistant Director at CareEdge growth trajectory will be driven by strong export demand, rising adoption of electric vehicles (EVs), easing inflation, and a revival in rural sentiment, supported by expectations for a favourable monsoon and improved income levels, Goswami the cumulative 100 bps rate cut by the RBI since February 2025 with the recent 50 bps rate cut announced last week, is expected to enhance affordability and boost demand, he that while domestic two-wheeler sales growth may moderate slightly due to a higher base, strong export momentum and rising EV adoption will help to sustain overall industry volume growth, Arti Roy, Associate Director at CareEdge Ratings said implementing OBD-II Phase-B emission norms is expected to have minimal impact, with the market showing resilience and adaptability."Additionally, good traction in executive and premium segment motorcycles is expected to support this growth in FY26", she Ratings also said that the overall growth of two-wheeler volume over the last three fiscal years has been supported by the increasing demand for electric two-wheelers (E2Ws).In FY23, E2Ws sales reached approximately 0.78 million units, accounting for 4.38 per cent of total two-wheeler sales (compared to 1.78 per cent in the previous year), reflecting a remarkable year-on-year growth of 180 per cent, albeit on a very low positive trend continued with E2W sales growing by 29 per cent in FY24 and 19 per cent in FY25 to reach 1.20 million units in FY25, CareEdge said.
Time of India
10 hours ago
- Automotive
- Time of India
Two-wheeler sales poised to accelerate by 9 pc in FY 26: Report
India's two-wheeler industry is poised to surpass pre-Covid sales levels in the financial year 2025-26 , with an expected volume growth of 8-9 per cent, according to a CareEdge Ratings report released on Monday. Key tailwinds such as easing inflation, higher disposable income driven by a full income tax rebate for individuals earning up to Rs 12 lakh per annum and a more accommodative monetary policy -- highlighted by the cumulative 100 bps rate cut by the RBI since February 2025 with recent 50 bps rate cut announced in June 2025 -- are set to boost consumer sentiment and affordability. A favourable monsoon could further strengthen the growth prospects, setting the stage for the industry volumes to surpass pre-Covid levels. CareEdge Ratings notes that during the past three years, ending FY25, the Indian two-wheeler industry maintained healthy volume growth of 8 per cent, 10 per cent, and 11 per cent in FY23, FY24, and FY25, respectively. Volume growth in FY25 was supported by a substantial 21 per cent export recovery and a 9 per cent rise in domestic volumes. The export recovery was due to stabilisation in key markets affected by inflation, high interest rates, and currency issues in earlier years. Domestic volumes were supported by a substantial uptick in rural demand and sustained urban demand, the report states. Madhusudhan Goswami, assistant director at CareEdge Ratings said, "CareEdge Ratings anticipates that the two-wheeler industry is set to vroom past the pre-Covid levels in FY26 with healthy volume growth of approximately 8-9 per cent, aided by export volumes accelerating at 12-14 per cent and domestic sales volumes maintaining a steady 6-8 per cent rise." "This growth trajectory will be driven by strong export demand, rising adoption of electric vehicles (EVs), easing inflation, and a revival in rural sentiment, supported by expectations for a favourable monsoon and improved income levels. Additionally, the cumulative 100 bps rate cut by the RBI since February 2025, with the recent 50 bps rate cut announced last week, is expected to enhance affordability and boost demand," he added. In FY25, rural areas accounted for 58.30 per cent of total retail registrations, marginally up from 57.9 per cent in FY24. While FY25 wholesale volumes of 23.81 million units remain just below the FY19 peak, the industry is steadily closing the gap. Though recovering from post-Covid challenges and price sensitivity, entry-level motorcycles have consistently improved since FY23. A shift in consumer preference towards scooters and executive motorcycles has also reshaped the market, signalling evolving demand patterns, the report added.
Time of India
11 hours ago
- Automotive
- Time of India
India's two-wheeler industry: Growth to surpass Covid-19 levels soon, driven by RBI rate cuts and robust domestic demand
The two-wheeler industry in India is set to undergo a massive selling surge, surpassing pre-Covid-19 levels, driven by RBI's rate cut, strong domestic demand and significant recovery in exports. According to a report by CareEdge Ratings, the sector is expected to register a healthy volume growth of 8–9% in FY26. This follows three years of strong performance, with volumes rising by 8% in FY23, 10% in FY24 and 11% in FY25. A key factor behind this growth is the Reserve Bank of India's cumulative 100 basis points rate cut since February 2025, including a 50 bps reduction last week, which is anticipated to make vehicle loans more affordable and spur demand. 'The cumulative 100 bps rate cut by the RBI since February 2025, with the recent 50 bps rate cut announced last week, is expected to enhance affordability and boost demand' said Madhusudhan Goswami, assistant director at CareEdge Ratings. The firm said that the FY25 growth was pushed by a 21% rebound in exports and a 9% uptick in domestic volumes. 'While domestic two-wheeler sales growth may moderate slightly due to a higher base, strong export momentum and rising EV adoption will help to sustain overall industry volume growth,' Goswami told ANI. Other factors expected to aid demand include easing inflation, more disposable income for consumers due to a full income tax rebate for individuals earning up to Rs 12 lakh annually, and expectations of a favourable monsoon season that typically benefits rural sales. Scooters and motorcycle growth Among segments, scooters have seen a particularly strong run, clocking double-digit growth for three years straight: 26% in FY23, 13% in FY24 and 17% in FY25. This trend is likely to continue, with scooters expected to outpace motorcycles in FY26, driven by rising popularity among urban commuters. Motorcycles, however, remain the backbone of the two-wheeler market due to their reliability and efficiency. In FY25, motorcycle volumes rose by 9%. 'This growth trend is expected to continue in FY26. Motorcycles remain popular due to their fuel efficiency, cost-effectiveness, and versatility, while scooters have gained traction, especially among urban commuters,' CareEdge noted. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
