India Scooter Market Outlook to 2028

India Scooter Market Overview

In 2018, India scooter market stood at USD 8.97 billion. The market reached a valuation of USD 10.70 billion in 2023, growing at a CAGR of 5.5% from 2018 to 2023. This growth is attributed to the expansion of the electric scooter segment, supportive government policies, and advancements in technology.

Leading players in the market include Hero Moto Corp, Honda Motorcycle & Scooter India, TVS Motor Company, Bajaj Auto, and Suzuki Motorcycle India. These companies dominate due to their extensive dealer networks, strong brand presence, and diverse product portfolios.

The rapid adoption and manufacturing of hybrid and electric vehicles (FAME II) scheme, launched in 2019, aims to promote the use of electric vehicles in India. With an outlay of INR 10,000 crore, the scheme provides subsidies for electric scooters, significantly reducing their cost and encouraging adoption.

India Scooter Current Market Analysis

The India scooter market is prospering with strong demand for both conventional and electric scooters. Petrol-powered scooters remain the major product category, accounting for a significant share due to their established infrastructure and consumer familiarity. However, electric scooters are rapidly gaining traction.

The sales volume is expected to grow further with the rise in demand for electric variants and increasing penetration in rural markets. Honda Activa is currently the bestselling scooter in India. Its popularity stems from reliability, strong brand value, and efficient performance.

In Maharashtra, particularly Mumbai and Pune, dominates the scooter market. These cities' dense populations and extensive commuting needs drive high scooter sales. Gujarat, especially Ahmedabad, also shows strong market performance due to its growing urban middle class and expanding city infrastructure.

India Scooter Market Segmentation

By Engine Type: The India Scooter market segmentation by Engine type is divided into petrol scooters and electric scooters. In 2023, petrol scooters dominate the market due to well-established infrastructure, higher performance, and longer range than electric scooters. The convenience of quick refueling and widespread availability also contribute to their dominance.

By Scooter Type: The India Scooter market is segmented by Scooter type into standard scooters, maxi scooters, and electric scooters. In 2023, standard scooters are the most popular type due to their versatility, affordability, and ease of use. They cater to a broad audience, from daily commuters to small business owners, offering a practical transportation solution.

By Region: The India Scooter market segmentation by region is divided into North, South, East and West. In 2023, the West region of India dominates the scooter market primarily due to its advanced urban infrastructure, high population density, and strong economic activities. The extensive commuting requirements and a large working population in this region make scooters an essential and practical transportation option, fueling consistent market growth.

India Scooter Market Competitive Landscape

Company

Establishment Year

Headquarters

Honda Motorcycle & Scooter India (HMSI)

1999

Gurgaon, Haryana

TVS Motor Company

1978

Chennai, Tamil Nadu

Hero Moto Corp

1984

New Delhi

Bajaj Auto

1945

Pune, Maharashtra

Suzuki Motorcycle India

2006

Gurgaon, Haryana

Hero Moto Corp's Launch of the Xoom 110: In 2023, Hero Moto Corp launched the Xoom 110, a new scooter model targeting young urban riders. The Xoom 110 features advanced connectivity options, including smartphone integration and GPS navigation. This launch is part of Hero's strategy to cater to the tech-savvy consumers.

Bajaj Auto's Expansion of Chetak Production Facility: Bajaj Auto expanded its Chetak electric scooter production facility in 2021 to meet the increasing demand for electric scooters. This expansion is expected to increase production capacity by 50%, enabling Bajaj to scale up its operations and address the growing market for electric scooters.

Suzuki's Launch of the Access 125 BS6 Model (2020) In 2020, Suzuki Motorcycle India launched the Access 125 BS6 model, featuring improved performance and fuel efficiency. This new model complies with the Bharat Stage VI (BS6) emission standards, reflecting Suzuki's commitment to environmental sustainability. The Access 125 BS6 has received a positive market response.

India Scooter Market Industry Analysis

India Scooter Market Growth Drivers

Increasing Urbanization and Traffic Congestion: According to the World Bank, India’s urban population is projected to grow from around 519 million in 2023 to over 600 million by 2030. This rapid urbanization, marked by a shift from 34% to 40% of the population living in urban areas, significantly impacts traffic congestion. The demand for efficient and cost-effective commuting solutions like scooters is escalating, particularly in densely populated cities, propelling the growth of India's scooter market as residents seek practical transportation alternatives.

Rising Disposable Incomes and Middle-Class Expansion: According to the National Statistical Office (NSO), the average monthly income of India households has increased reaching INR 32,567, leading to higher consumer spending power. As more households move into higher income brackets, the propensity to purchase scooters for convenience and status symbol increases.

Technological Advancements and Improved Infrastructure: The average range of electric scooters has improved over the past five years, with some models offering up to 150 kilometers on a single charge. Additionally, the expansion of charging infrastructure, with over 1,000 new charging stations installed in 2022, supports the growing use of electric scooters.

India Scooter Market Challenges

High Initial Costs of Electric Scooters: Despite the long-term cost benefits, the initial purchase price of electric scooters which is INR 70,000 to 80,000, remains significantly higher than that of traditional internal combustion engine (ICE) scooters. The average price of an electric scooter is higher than a comparable ICE model. This price disparity, coupled with limited financing options, poses a barrier to widespread adoption, particularly among lower-income groups who are price-sensitive.

Battery Performance and Longevity Concerns: The average lifespan of a lithium-ion battery in scooters is about 3-5 years, after which performance degradation becomes noticeable. The cost of battery replacement, which can be a significant portion of the scooter’s original cost, also adds to consumer apprehension.

Regulatory and Safety Issues: The scooter market faces challenges related to regulatory compliance and safety standards. Safety concerns, such as inadequate testing and certification processes for new models, pose risks to consumer safety. Reports of accidents and malfunctions in poorly regulated markets can lead to negative perceptions, affecting overall market growth.

India Scooter Market Government Initiatives

National Electric Mobility Mission Plan: The National Electric Mobility Mission Plan (NEMMP) aims to achieve 30% electric vehicle penetration by 2030. This comprehensive plan includes incentives for manufacturers and consumers, investments in charging infrastructure, and support for research and development in EV technology.

Production-Linked Incentive (PLI) Scheme for Automobile and Auto Components: The PLI scheme, introduced in 2021, incentivizes domestic manufacturing of automotive components, including those for electric scooters. With a budget of INR 57,042 crore, the scheme aims to boost local production and reduce dependency on imports.

State-Level EV Policies: Several India states have introduced their own EV policies to complement national initiatives. For instance, Maharashtra’s EV policy, launched in 2021, offers additional subsidies and incentives for electric scooter buyers and manufacturers. Such state-level policies create a favorable environment for the growth of the scooter market.

India Scooter Market Future Outlook

The India scooter market is projected to grow exponentially, this growth will further flourish by increasing demand for electric scooters and supportive government policies.

Future Trends

Integration of Smart Technologies: The integration of Internet of Things (Io T) and connectivity features in scooters will continue to expand, with models from companies like Ather Energy and TVS Motor Company increasingly equipped with advanced features such as GPS tracking, anti-theft systems, and mobile app connectivity. The ongoing adoption of smart technologies will remain a key driver of market growth, aligning with consumers' rising demands for intelligent and interconnected mobility solutions.

Growth of the Shared Mobility Market: In Bengaluru, the number of shared scooters is expected to rise further beyond the 10,000 units as recorded in 2023, driven by ongoing high demand for flexible commuting options. The expansion of shared mobility services will continue to contribute to the overall market growth, offering a sustainable alternative to traditional vehicle ownership models.
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