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Executive Summary
India which is counted amongst the largest two-wheeler market in the world stands next only to China
and Japan in terms of number of bikes produced and sold. With ever changing lifestyle and growing
disposable income bike is no more considered as just a mode of transport rather it has become a style
statement for youth. These factors have not only given the confidence to International bike makers to
enter this market with their premium segment but have also got them accepted by the consumers. This
has come to level that today Indian market has access to around 11 premium bike makers as against
Conceptualize the market and factors that have influenced the bike manufacturers to consider
Establish relation between pricing, technology and regulation with the market acceptance
In this report we will try to institute the macroeconomic factors and drivers including inflation and
import duties implemented along with benefits of outsourcing the manufacturing process or creating JVs
with already established local producers. This approach would enable us to create a relation between
demand and market of these premium bikes to mark the future of International manufacturers in India.
The result would illustrate factors and sensitivity of consumer towards the segment allowing us to
diagnose the underlying causes of recent trends – how has the premium bike segment seen a higher
growth than the middle capacity segment in developing country like India.
2. Introduction:
On road traffic along with conditions of motorway and affordability makes two-wheeler segment the
most loved category in Indian market with over 20 Million units being sold in year 2018. Even if the road
conditions are not supportive and mentality prevails to buy a four wheeler for family than buy a two
wheeler to commute, superbikes have still crafted a niche segment for themselves in Indian market with
almost 5% of market share being defined by bikes above 250cc capacity. Growing disposable incomes,
reduction in excise duties and local manufacturing done by International players are all expected to play
their part in growing this segment with a CAGR of above 25% in coming 5 years.
Year 2018 saw a growth of over 20% in premium segment bikes as compare to around 15% in bikes
displacing less than 250 cc. Harley Davidson is one of the first entrants in this segment and still holds a
special place in heart of youths that has been challenged by Royal Enfield as being locally produced and
most affordable premium bike in this segment. If Harley Davidson and Royal Enfield compete in cruiser
segment then Honda competes with Yamaha in the racing/ sports bike segment.
This report begins by setting out the need of two wheelers in India and then defines the competitors’
advantages along with Govt. regulations to carve out the future of International players in this market.
Understanding the Biking market in India
Once considered only a mode of commuting, the two wheeler segment was revolutionized by the entry
of Royal Enfield in early 1950s that was used by the army for border patrolling. The bike that was then
measured as a distant dream gave way to Royal Enfield acquiring measure market share in Indian
premium bikes today. With change in times the Indian market saw entry of players like Harley Davidson,
Ducati and others. Racing enthusiasts were taken for a ride by Yamaha through its RD350 which became
one of the most sought after bike after its launch in year 1973; this market was then completely
revolutionized by the entry of ‘Pulsar’ series by Bajaj that provided market with the most affordable
sports bike available ever. The Pulsar series made way for other manufacturers like Hero (then Hero
Honda) with its CBZ & Karizma and the market was then flooded with various other sports bikes. This
initial spark from few sports bike has shaped into a wild fire with both International manufacturers and
local producers coming into competition to acquire the premium bike market.
Fierce competition has made these bikes being priced more aggressively which has in turn helped this
segment to achieve superior growth. The national launch of these bikes tends to get host of changes
than its principal version. Alterations like trimmed body, chrome finishing rather than gold finishing and
a few parts being replaced with more affordable ones help these manufacturers with highly competitive
pricing while giving the bike enthusiast required adrenal rush. Alongside, few changes are made to keep
the premium bike well suitable for the road conditions while keeping in mind the riding abilities and
Govt. regulations for the premium bikes, today the Indian Premium bike segment falls under this category
two-wheeler market has changed from commuting to wherein the market has seen a splendid growth
personal liking and passion. What was once sold as status
bike has been immense over last few year with the surge
Electric two wheelers constitute this category as they are profitable categories of Indian two wheeler
With the amount of growth witnessed by the Indian two- 150 cc make part of the major volume of sales
wheeler market there is no scope for any dog performed by every bike manufacturer. Even
of units sold.
BCG Matrix for Indian two wheeler market
Partnership of Bajaj with KTM and entry of Duke 390 has modernized the market by giving an option of
most affordable premium and high performance bike in the segment. Despite it being one of the most
affordable premium bikes in market there has still been negligible impact on its competitors due to the
fact that this market is driven by brand value and consumer loyalty which is hardly impacted by any
other factors.