Description
COVID-19 has brought the two-wheeler industry to a screeching halt. Governments across the world were forced to institute lockdowns on commercial and personal life for nearly two months. The automotive industry took the biggest hit as the global supply chain had to come to a halt. With customers not purchasing new vehicles, the two-wheeler (2W) industry suffered the biggest blow to business.
Asian countries constitute the largest markets for 2Ws, especially India, China, Vietnam, Indonesia, and Thailand. Before the COVID-19 crisis, new 2Ws were being sold at the rate of nearly 20 million a year, or 10 million every 6 months. However, in the first six months of 2020, this number was estimated to reduce to 40% or approximately 4 million 2Ws, if the supply chain were to open at all. European and North American markets did not suffer much, as not all retailers had closed, and traditional sales volume had never been as large as that of Asia. However, with global economies beginning to open up, the 2W industry is set to see the release of pent-up demand and a surge in sales.
Sales have rebounded by more than 100% in some markets because of the pent-up demand and personal mobility becoming a necessity in the time of the pandemic. This is expected to continue in the short-to-medium term, even after a global vaccine is made available, as two-wheelers offer a more affordable, convenient, and rapid transportation means than passenger cars. Other business moves that would help boost industry growth until 2026 are bolstering a company’s financial health, online sales and promotions, new shared mobility partnerships, mergers and acquisitions, connectivity, and telematics investments, among others.
After global 2W companies survive the outbreak and rebuild their companies financially, the next step would be to train their focus on future growth strategies, such as developing more premium 2Ws, connected and telematics solutions, rider assistance technologies for enhanced rider safety, electric solutions, and shared mobility partnerships. These avenues will be critical to penetrating new markets, and most importantly, to enticing new customers in the millennial and Gen Z age groups toward riding, as Baby Boomers and Gen X are more likely to prefer passenger vehicles for personal transportation.
Author: Viroop Narla
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