August 9, 2020

Two-wheeler gross sales on restoration path throughout home, export markets: Bajaj Auto

NEW DELHI: Bajaj Auto is witnessing a robust revival in demand for two-wheelers within the home in addition to worldwide markets, even because it continues to face headwinds within the three-wheeler phase, a senior firm official has mentioned.

The corporate, nevertheless, expects to have a a lot clearer development at its disposal by the following month-end to see whether or not the present demand for two-wheelers is only a pent-up demand from earlier months or the business actually is again on a revival path.

“We’re seeing month-on-month enchancment in gross sales. There was no sale in April whereas the decline was very giant in Could. June was considerably higher than Could and July is a lot better than June,” Bajaj Auto CFO Soumen Ray advised PTI.

The demand state of affairs is coming again fairly sharply and it may very well be a pent-up demand as nicely, so the readability would emerge solely in August, he added.

In April-June, the corporate bought 1,85,981 models within the home market, down 69.55 per cent from 6,10,936 models in the identical interval final yr.

Ray, nevertheless, famous that the home three-wheeler phase will take a while to revive.

“Such automobiles are largely purchased by taking mortgage. So why would somebody like to start out an EMI when there isn’t a enterprise? Passenger three-wheeler restoration will occur as soon as this as soon as these lockdowns finish,” Ray mentioned.

The corporate’ CV gross sales (three-wheelers) within the home market in the course of the first quarter of the present fiscal plunged by 93.87 per cent to five,282 models as towards 86,217 models within the April-June interval of the final fiscal.

When requested if the corporate expects issues to show round by festive season, he mentioned: “Actually, hope so, there isn’t a cause why it shouldn’t occur. Nonetheless, we should see August. If now we have moderately sturdy August then we’re set for festive season.”

He mentioned that firm’s Waluj (Aurangabad) plant is operational and there have been solely a only a few employees who have been in quarantine as a consequence of COVID-19.

The manufacturing facility is presently operating with capability utilisation of round 65-70 per cent, Ray mentioned.

When requested if the corporate had earmarked any capex on capability growth this fiscal, he mentioned: “Our put in capability is 63 lakh models each year and proper now we’re working at sub 50 lakh. Final yr, we did round 48 lakh models so there isn’t a query of placing up extra capability.”

On exports, Ray mentioned that nearly each market the corporate caters to has been impacted because of the coronavirus pandemic.

“Luckily, now we have an order guide and we proceed to ship. In retail phrases we’re witnessing related phenomenon as we’re seeing in India. Two-wheelers are coming again a lot quicker than three-wheelers,” Ray famous.

Bajaj bought over 2,13,000 models within the worldwide markets in first quarter as in contrast with 4,71,691 models in the identical interval final yr.

KTM, through which Bajaj Auto has 48 per cent stake, is witnessing very sturdy revival in international locations like Germany, Australia and the US, he added.

Throughout April-June, KTM reported gross sales of 33,220 models as in contrast with 38,267 models in the identical interval of the earlier fiscal.