TVS Motor, Hero MotoCorp both see sales slowdown in December

Hero MotoCorp, the world’s No.1 motorized two-wheeler maker, and rival TVS Motor Co both reported declines in their December auto sales.

While Hero MotoCorp’s December sales fell by 12% in the domestic market, TVS Motor Co reported a fall of 17% in its domestic market sales during the month.


TVS Motor Co’s India 2-wheeler sales fell by around 30,000 units. However, its 2-wheeler exports actually went up by around 7,000 in December.

As a result, on a blended basis, the company’s two-wheeler sales in the month was down by only around 23,000 units, or about 8.8%, at 2.35 lakh.

Despite the slide in sales, the India market continued to dominate TVS’ overall sales, accounting for 1.47 lakh out of 2.35 lakh of 2-wheelers sold in the month.

Three-wheeler sales for TVS Motor increased to 15,541 units from 13,845 units in the year ago period.


Hero MotoCorp Ltd, which had seen a 43% fall in its India two-wheeler sales in November, had some reason to cheer in December as the pace of fall slowed somewhat to 12% in December.

The company sold 3.74 lakh two-wheelers in India in December, down 12% from the 4.25 lakh reported in December of 2020.

This is better than the result in November, when its total domestic two-wheeler sales had fallen by a whopping 43% to 3.29 lakh from 5.76 lakh a year earlier.

At the time, the poor performance was blamed by the company on a slow-down in demand in rural markets due to delayed harvesting of crops.

It also said it things would reverse by around January, since farmers were in the process of harvesting their crop and would soon have cash in hand to spend.

“Delay in harvesting due to the late withdrawal of monsoon in many parts of the country impacted the demand post festive season,” it said a month ago.

“With the economy gradually opening up coupled with several other positive indicators, such as encouraging farm activity, confident consumer index and marriage season, a swift revival in sales is expected in the fourth quarter.”

It’s latest update did not provide any such guidance or hope.

The December sales decline was visible in the both Hero MotoCorp’s scooters and motorcycles.

Sales of scooters during the month almost halved year-on-year to 17,911 units from 32,236 units last year, while sales of motorcycles motorcycles fell 9.2% (see chart below).

Hero MotoCorp two-wheeler sales December 2021

A similar trend was also seen in its auto sales for November, when scooter sales fell to 20,208 from 49,654 units a year ago.


Interestingly, both the leaders of India’s two-wheeler and four-wheeler markets — Hero and Maruti Suzuki — seem to be facing very similar headwinds.

While Maruti Suzuki had seen a sharp fall in its India sales in November, the four-wheeler maker was able to improve the situation slightly in December by narrowing the fall to 13%.

This may have to do with their positioning. Both Hero MotoCorp and Maruti Suzuki are famous for their value-for-money offerings, and appeal primarily to value-conscious, middle and lower-middle-class buyers.

Their poor performance indicates that this segment of the Indian population — which includes both farmers as well as the salaried class — have been hurt much more by COVID and the lockdowns compared to the upper middle class and affluent segments.

Brands that cater to the more well-off customers have done better in the last two months, compared to Hero MotoCorp and Maruti Suzuki.

More details will be available when Bajaj Auto and TVS Motor corp — both of which have slightly higher average selling prices compared to Hero — report their numbers on Monday.


At the same time, things could get worse before they get better for automakers because of the start of the third wave of COVID in India.

India’s total COVID cases have been doubling every 1.5 days for the last 3-4 days due to the arrival and propagation of the Omicron variant of Coronavirus.

Any exacerbation of the situation would not only hurt demand, but also production and distribution of vehicles.

Hero MotoCorp said it continues to monitor the on-ground situation.

It added that “localized restrictions imposed by certain states in the wake of rising Omicron cases will continue to restrict the customer movement”.