Swot Analysis Of Two Wheeler Industry

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EXTERNAL ENVIRONMENT ANALYSIS

ABOUT THE INDUSTRY

The Indian automobile industry is one of the the largest in the world. It contributes to 7% of GDP and provides employment to 30 million people and contributes 13 % to excise revenue. The two-wheeler industry has the largest market share of automobile sector in India, holding 78 per cent of the market. It is basically divided into three segments: motorcycles, scooters, and mopeds. The bulk of India’s two-wheeler sales come from commuter motorcycles and automatic scooters. The industry is expected to grow at 10% in the future.

INDIAN TWO-WHEELER INDUSTRY

The Indian two-wheeler industry is the largest in the world with beating China and Japan. Indian manufacturers sold around 20 million
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The scooter segment outperformed motorcycle sales in Q1 FY2018.
The surge in consumer demand for both these vehicle sub-segments is what is driving overall segment numbers.

Indian and foreign two-wheeler companies are concentrating more on exports, particularly from India to Vietnam, Thailand, Indonesia, Middle East, Latin America and African nations, where two-wheelers business market is untapped.

The following reasons have contributed to this increasing share of scooters and why we believe they will continue to grow much faster ahead:

Increasing female riders: Women have a clear preference for scooters and hence once they start going to schools/colleges/offices, scooters ' sales increase. More and more women are learning driving now these days and impact is obvious.

Improving road conditions: The bigger wheels of bikes make them easier to ride in bad road conditions and hence they are the default choice in rural areas, but now with road quality improving, the trend is moving towards
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Intensely competitive industry
2. Similar design of all models with similar features
3. Lost market share

Opportunities
1. Two-wheeler segment is one of the most growing industries
2. Untapped international markets
3. Introduction of bikes in the premium segment

THREATS
1. Development of better public transport in India
2. Emergence of new players
3. International competition will increase as Chinese companies losing their domestic market will invest more in India

FUTURE STRATEGIES FOR HERO

1. Since scooter market is in the demand Hero should launch more scooter variants with attractive features and designs.
2. Hero only has the Karizma bike in premium segment which is on the rise it should launch more premium bike to counter Honda CBR and KTM Duke.
3. Hero can enter 3-wheeler segment like TVS with TVS KING autos.
4. Hero can make more accessories and parts on its own which will lead to better customer service.
5. Hero should research electric scooters
6. Hero must look into untapped International markets like Vietnam, South America and Africa.
7. Provide better finance opportunities to customers.
8. Diversification into sports bikes.

References: -

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