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Still double digits

Issue Date - 22/12/2011
B&E: Passenger cars have seen negative growth over the past few months. Do you see a similar trend impacting the Indian two-wheeler industry as well?
AM: Challenges like rising fuel prices and interest rates are currently the main hurdles in the growth of the industry. As these two have a bigger effect on the passenger car buyer, the segment has not been able to grow as per initial estimates at the starting of the financial year. It is expected that the two-wheeler industry will also face tough times. In case of two-wheelers, there is a high chance that the growth will moderate but it will still be in double digits at the end of this financial year. As most purchases in the two-wheeler sector take place on cash, the rise in interest rates does not effect the growth of the two-wheeler sector to an extent.

B&E: India is currently the second largest market for two-wheelers across the globe. Do you believe that the relatively new entrants have a fair chance of making deep inroads in the coming few years?
AM: India is one of the most competitive markets when it comes to two-wheelers. Over the past one decade, many new names have entered the segment. But one needs to understand that for a new player, it is very tough to get the product strategy right in the first instance. Moreover, rural India has a lot of potential but to harness it optimally, one must create a strong distribution & service network.



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