)
The TVS Motor Company has stated the two-wheeler sector in 2013-14 might suffer due to weak economic growth, resulting in industry growth being between negative and positive three per cent, even as long term prospects for the industry are attractive.
"The global economy showed no signs of recovery during 2012-13 and is expected to be more uncertain. This might result in volatile crude and commodity prices and fluctuations in foreign exchange rates. In the domestic economy, continued inflationary pressures, lower private consumption and high interest rates are likely to affect sentiments," the company said in its 2012-13 Annual Report.
The report noted overall sales of scooters in the domestic market declined by 13.1 per cent, while those of mopeds grew by 2.7 per cent, despite a weak macro economy and a deficit monsoon affecting the rural economy. It added TVS Motor's overall two wheeler sales declined by seven per cent, mainly due to the overall sluggish performance of the industry.
Mopeds grew at 1.9 per cent, motorcycles declined by 10.5 per cent and scooters by 15 per cent.The report said with the launch of 'TVS Phoenix 125' in the executive segment, the company had a presence in all segments of the two-wheeler sector.
To address the growing need of scooter usage by men, the company would launch a new scooter in the coming year. This new launch would further strengthen the company's presence in the scooter segment.
The plan is driven by the trend of category shift from motorcycles to scooters, which continued in 2012-13, bringing more male buyers into the category. "The shift in scooter consumer preferences towards bigger scooters, resulted in a drop of TVS Scooty sales. The consolidation of TVS Wego would address this issue," said the report.
The company's sales declined by 4.9 per cent in the domestic market and in the motorcycle category, the decline was higher at eight per cent, which would be addressed by the recently launched TVS Phoenix 125, the report added.
TVS Motor launched the new TVS Sport, TVS Phoenix 125, TVS Apache and the new Scooty in 2012-13.The long term prospects for the two-wheeler industry, however, continue to be attractive, said the company. The favourable demographic profile, low penetration of two-wheelers, the rising income of the Indian middle class, the significant portion of the Indian population having no or limited access to decent transportation infrastructure and congestion in large cities work in favour of Indian two-wheeler industry, it noted.
"Preference of owning a personal transport has gone up in the last few years. These trends are expected to continue in the medium to long term, though 2013-14 might suffer due to weak economic growth," said the report.
