Demonetisation Affect; Two-Wheeler Sales Continues To Suffer

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The demonetisation had a severe impact on the sales of two-wheelers in the country. Especially, motorcycles took the worst hit in the aftermath of demonetisation.

Demonetisation Affect; Two-Wheeler Sales Continues To Suffer

The cash-driven motorcycle segment nosedived in the rural market. Major manufacturers including Hero MotoCorp, Bajaj Auto, and TVS Motor Company reported a decline in sales in December 2016.

Demonetisation Affect; Two-Wheeler Sales Continues To Suffer

India's largest two-wheeler manufacturer, Hero MotoCorp reported a negative growth of 33.9 percent in December 2016. Bajaj Auto too suffered 11 percent dip in sales as compared to the same period of 2015.

Demonetisation Affect; Two-Wheeler Sales Continues To Suffer

Likewise, TVS Motor Company also reported negative growth of 8.76 percent, as the cash crunch took a toll on the two-wheeler segment.

Demonetisation Affect; Two-Wheeler Sales Continues To Suffer

According to industry estimates, 50 percent of the motorcycle sales comes from the rural market. The entry-level models are in high demand and it is a cash-driven segment.

Demonetisation Affect; Two-Wheeler Sales Continues To Suffer

As per a report from SIAM, two-wheeler sales stood at 2,43,251 units compared to 13,20,552 units in November 2016. Motorcycle sales were down by 10.21 percent as compared to December 2015.

Demonetisation Affect; Two-Wheeler Sales Continues To Suffer

Before demonetisation, two-wheeler sales were up by 8.72 percent, but post demonetisation, the two-wheeler sales slumped. Industry experts believe that because of inventory pileup, manufacturers have reduced the production to cope with the situation.

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