Bicycle industry registers steady growth despite momentary hiccups

By: O P Munjal

Growth in the domestic bicycle market during the post-Independence era is steady and consistent. Despite momentary setbacks and subsequent decline in overall production mainly because of imposition of excise duty on bicycles and steep rise in prices of steel during the recent past, the industry is well organised and has economies of scale.

These economies of scale have made the bicycle manufacturing viable to successfully fend of the global competition. Against all speculations of invasion by Chinese bicycle industry and their penetration to India, they have not been successful so far. In fact, because of its economies of scale and efficient operational capability, the domestic industry has given a tough competition to China in Africa and South-East Asia.

The competition has increased, locally and globally. We, at Hero Cycles are very much a part of the global market. The bicycle manufacturers have no option but to meet the demand of the quality-conscious consumers by introducing new models with latest technology and still remain cost competitive. Despite an overall national demand recession, our bottomline is not affected. In other words, we have taken the fast-changing scenario in our stride.

The Indian Bicycle industry is divided mainly into three segments Roadsters; MTB, Fancy and high-value added kids. Despite static growth, the Roadsters still hold major share of market. Next to the roadster bicycles are fancy and kids segments, demand for which has been increasing steadily. These segments are in line with international market requirements. Hero Cycles, already the industry leader with 50 per cent share in the market, has recently signed a technical collaboration agreement with Japan-based National Bicycle Industries, makers of the National/Panasonic brands. We are producing finest bicycles with Japanese technology, for both Indian and Global market. We, in fact, have a good presence globally. In other words, a consumer wants the best products, that too at most economical prices and HERO has both.

Hero Cycles Ltd.

We have different models and combinations to offer to the customers - both in rural and urban markets. The rural market is utility-oriented where demand for the conventional bicycles continues while the psychology of urban market is entirely different. There is an increasing demand for lower age group and the largest segment here is that of children. Establishing ourselves as front-runners in this segment with a series of innovative product launches, we have clearly tilted the competition balance in our favour. Needless to say that we have substantially widened the gap between our nearest rivals as far as manufacturing of bicycles, both qualitatively and quantitatively, is concerned.

The Indian consumer is steadily becoming quality conscious and his aspirations too, are changing. In line with our tradition to launch innovative and latest models, you have already received D-series followed by Super Start Series for the young riders. Didn’t you feel the change? How about the new roadster cycles? Don’t you think that Japanese technology has already started making wonders?

The recently-launched products have been received well by the consumers. Our collaboration is just a few months’ old. You could imagine what revolutionary difference this tie-up is going to make in the years to come. Just wait and watch.