After consistently growing for the last 15 months, scooter sales saw a marginal decline of 1.4% at 555,467 units in May, compared with the same month last year, Society of Indian Automobile Manufacturers data showed. The last time scooter sales saw a decline was in January 2017, when it slid by 14.50%. Industry sources have attributed this decline to inventory correction by some companies. Sales data captures despatches from manufacturers to the dealers but if retail sales are not as per expectations, dealers are left with higher inventory, the result of which is that manufacturers have to make lower despatches till the inventory gets cleared.
Something like this happened as scooter manufacturers pushed huge volumes in March and April. During FY18, two-wheeler sales crossed 20 million units, registering a strong double-digit growth of 14.8%, the first time since FY12, partly helped by a low base in FY17 on the back of demonetisation and slowdown in rural recovery. Of this, motorcycles grew at 13.7% while scooters grew by 20% on the back of growing sales in non-urban markets.
Scooter sales in April clocked a growth of 12.63%, which means manufacturers had despatched higher volumes to the dealers. With retail sales not that high, some inventory correction was needed, which happened in May.
Industry executives said that back in January 2017 too, scooter sales had declined because of inventory correction by the two major players, Honda Motorcycle and Scooter India and Hero MotoCorp. The same reason is being assigned for the marginal decline in May.
During the month, HMSI, which is also the country’s largest scooter manufacturer, reported a marginal decline in scooter sales (2.09%). Hero MotoCorp had corrected its inventory in April itself.
By- Kritika Agrawal
