Back in the early '90s, scooters were still India's favourite mode of transportation, and in 1992-93, over a million were sold. The best-seller then was the Bajaj Chetak. Since then, the scooter market in India seemed to have gone into a terminal decline, with sales falling to under 600,000 units in 2000-01. Seven years later, the scooter market is seeing a revival, primarily thanks to one company, Honda Motorcycle and Scooter India (HMSI). Leading the charge is the Honda Activa, its best-selling model.
In the first four months of the current financial year, domestic sales of scooters and scooterettes have climbed 17.15 per cent to 344,000 units. And sales for HMSI in this segment have climbed 33 per cent, even as one-time segment leader Bajaj Auto shuttered its scooter factory at Akurdi near Pune.
It seems that HMSI cannot make scooters fast enough-the company actually has a waiting list for deliveries, which, in certain markets like Kerala, is as long as 40 days. "What is remarkable is the number of people who make cash-down payments for HMSI products," remarked Ashok Khanna, Executive Vice President, hdfc Bank, a large auto financier, to this magazine recently. The HMSI plant at Manesar is bursting at the seams, with a rated scooter capacity of 600,000 units per annum; it is running at full-steam, manufacturing more than 50,000 scooters every month. Little wonder then that HMSI is looking to gradually increase capacity to 800,000 units per annum for scooters as well as increase its dealer network from 400 to 600 within three years.
Rajiv Bajaj, MD, Bajaj Auto has also stated his desire to re-enter this segment and also showcased a scooter, called Blade, at the 2006 Auto Expo in Delhi. HMSI's sister company, Hero Honda Motors (HHML) which has seen sales of its Pleasure scooter stagnate, has signed up leading Bollywood actress Priyanka Chopra to be its brand ambassador. With all the action it seems that the scooter market will break the million unit sales mark for the first time in 15 years this financial year.