Bajaj Auto, TVS lead the charge in electric two-wheeler sales surge

Incumbent two-wheeler players Bajaj Auto and TVS Motor Company have upped the ante in their battle for the electric two-wheeler (e2W) sweepstakes on the back of expanding distribution and their entry into the sub-Rs 1 lakh segment for the first time.

The volume push was led by Bajaj, which saw its vehicle registrations go up by a staggering 79 per cent to hit 16,269 in July over the previous month. As a result, its registration share saw a sharp increase from 11.6 per cent in June to 16.9 per cent in just a month.

Clearly, incumbent operators are striking back.

For instance, Bajaj and TVS collectively grabbed a larger share of the market, with their registration share going up from 29.7 per cent in June to 35.69 per cent in July, according to Vahan data as of July 31.

This has also given a much-needed boost to e2W sales, which are close to touching 100,00 and were pegged at 96,062, growing by 24 per cent over June after remaining flat for months.

Even a laggard in the game, Hero MotoCorp, posted its best numbers, selling over 4,659 vehicles, which simply means that the legacy players now have crossed a 40 per cent share of the e2W market.

Of course, market leader Ola Electric, whose initial public offering is all set to open on August 1, remains by far the leader in the business with a market share in July of 40.48 per cent. However, the battle from incumbents is expected to heat up, especially in the volume sub-Rs 1 lakh segment. The company had a 49.8 per cent share of the market in May, which fell marginally to 47.5 per cent in June.

Explaining the change, Harshvardhan Sharma, head of automotive retail practice at Nomura, says, “The change suggests that incumbent players, with their extensive distribution networks, brand trust, and after-sales service infrastructure, are now leveraging their strengths to capture a larger share of the rapidly growing e2W market.”

Sharma adds that what one can now expect is more competition with price wars, technology innovation, and improvements in battery technology, all of which will, in turn, accelerate the pace of infrastructure development like charging stations. And, of course, it will be good for consumers.

Competition has also spurred startup player Ather Energy to push volumes but in the plus-Rs 1 lakh market. Sources say it has received sizeable bookings for its newly launched family electric scooter Rizta, which has helped pull up its sales, which had been flat for a few months. It has been able to increase its registration share from 8 per cent in June to nearly 10 per cent in July.

Incumbent two-wheeler players say that the battle will only intensify with more models slated to hit the sub-Rs 1 lakh segment.

Says a top executive of a legacy two-wheeler company, “The free run in the sub-Rs 1 lakh segment for our competitors is now over. We will now aim at the Rs 70,000-85,000 range very soon — it is, after all, the majority of the scooter market.”