M&M looks to double bike, scooter sales by year-end

Is hiking production of Centuro to meet growing demand, exports

Mahindra & Mahindra has set a target of doubling its motorcycle and scooter sales by year-end, riding on the success of its 110cc Centuro bike.

Mahindra Two Wheeler, the group’s motorcycle arm, is confident of selling 250,000 bikes and scooters by month-end, a 126 per cent rise over sales in 2012-13. By January, the company had sold 174,505 two-wheelers.

Much of the surge is due to the Centuro, 100,000 of which were sold in six months.

Pawan Goenka, executive director and president (automotive and farm equipment), said, “With the Centuro  we have what I would consider serious entry into this segment and we will end this year at about 250,000.”

Mahindra Two Wheeler is rasing output to meet demand for the Centuro and push exports to 50,000 next year in five-six new markets. Exports would play a strategic role in M&M’s expansion, Geonka said.

The Mumbai-based company will launch a scooter by June, the fifth after the Duro, Rodeo, Kine and Flyte.

“We have to be selling about a million two-wheelers in a year at a gross margin of about 20 per cent,” Goenka said told analysts about the company’s third-quarter performance.

"We are no way near that in FY14, we will not reach there in FY15 but that will be our ultimate objective before we can say that yes we have arrived in the two wheeler space, so right now what we are looking at is how do we get to that million volume and how do we get it 20% market share," added Goenka.

Presently, Mahindra Two Wheelers has a share of 1.35% in the domestic market. More than 80% of the local market is controlled by Honda, Hero MotoCorp and Bajaj.