Two-wheeler sales growth to decelerate to mid-single digits in next 5 years
With household penetration of two-wheelers increasing to reach a high, the growth in the industry is expected to decline over the last few years.
Key highlights:
- Domestic industry volume CAGR at 5.5% over FY12-17
- Deceleration in growth is due to the high household penetration level currently
- Nationally two-wheeler household penetration stood at about 42% in FY17
The Indian two-wheeler industry should prepare for growth shock as it is expected to structurally decelerate to mid-single digits with the beginning of the maturity phase of the market. The domestic industry volume compound annual growth rate (CAGR) at 5.5% over FY12-17 is significantly lower than 12% over FY02-12, according to a SBICap Securities report.
The reason the two-wheeler industry will see a deceleration in growth is due to the high household penetration level currently.
Two-wheeler sales recovery seen in May with several firms posting double-digit growth
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