Expected Decline in FY21 Two-wheeler Sales

Coronavirus lockdown is likely to cause a slump in FY21 two-wheeler sales as compared to the previous fiscal.

According to the ICRA (Investment Information and Credit Rating Agency), the Indian two-wheeler market is expected to witness another bad fiscal thanks to the coronavirus outbreak. Due to the lockdown, FY21 two-wheeler sales are expected to further drop by as bad as double-digit percentage figures as compared to the 2020 fiscal; which was also a year that saw decline in the two-wheeler sales. With the BS6 norms taking effect, this was already slated to be a tough financial year due to the increase in two-wheeler pricing from updates as well as the additional emission control equipment. If the coronavirus situation worsens, things could become even tougher.

Further losses await the manufacturers who did not plan early for the BS6 regulation because they will have to absorb the unsold BS4 stock as well. Thankfully, the smartest manufacturers began the transition the previous year and so they should be in relatively safe waters. At this stage, long-term predictions are out of the question and near-term recovery looks bleak. However, the ICRA believe that there will be positive growth in the medium term for FY21 two-wheeler sales if things go well and the lockdown is lifted soon.