Motorcycle sales drop slightly in 2022

Tue Jan 3, 2023 09:15 AM Last update on: Tue Jan 3, 2023 03:47 PM

Rising inflationary pressure contributed to an overall decrease in local demand for two-wheelers. As per market data, a total of 587,689 motorcycles were sold last year while 587,925 units were sold in 2021. The photo was taken from Khulna city last night. Photo: Habibur Rahman

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Rising inflationary pressure contributed to an overall decrease in local demand for two-wheelers. As per market data, a total of 587,689 motorcycles were sold last year while 587,925 units were sold in 2021. The photo was taken from Khulna city last night. Photo: Habibur Rahman

Motorcycle sales in Bangladesh did not show any growth but rather shrunk in 2022 as the ongoing economic crises, such as rising inflationary pressure, contributed to an overall decrease in local demand, according to industry insiders.

As per market data, a total of 587,689 motorcycles were sold last year while 587,925 units were sold in 2021. However, the fall in sales was mostly limited to the second half of the year.

A total of 241,264 motorcycles were sold from July to December in 2022, down by 18 per cent compared to 294,815 units in 2021, the data shows.

Meanwhile, motorcycle registration ramped up last year with data from the Bangladesh Road Transport Authority (BRTA) showing that 465,484 units were added to its books from January to November compared to 375,252 units throughout 2021.

This is mostly due to a move by the BRTA making it mandatory for owners to hold a valid driver’s licence when securing a registration number for every two-wheeler purchased from September 15 onwards.

The deadline was initially extended until December 14 before being pushed back by another two months on request from the Bangladesh Motorcycle Assemblers and Manufacturers Association.

Subrata Ranjan Das, executive director of ACI Motors, the local distributor of Japanese brand Yamaha, said overall sales were practically the same in 2022 as they were the year before due to inflationary pressure and the US dollar crisis.

According to him, two-wheeler prices have surged by an average of around 8 per cent following the taka’s depreciation against the US dollar.

Referring to their market assessment report, Das said although overall sales declined, sales of high-end motorcycles increased significantly.

For example, sales of Yamaha and Suzuki motorcycles rose by 52 per cent and 55 per cent respectively.

Similarly, sales Hero motorcycles grew 12 per cent year-on-year in 2022.

On the other hand, sales of TVS, Honda, Runner and other brands fell by 4 to 29 per cent at the same time.

Abdul Matlub Ahmad, chairman of Nitol Niloy Group, the local distributor of India’s Hero MotoCrop, said sales increased after September as the price hike of petrol and diesel led to increased fares for public transport.

“For this reason, the sale of motorcycles increased in rural and urban areas as people wanted to reduce their transport costs,” he added.

Ahmad went on to say that sales of high-end bikes increased as buyers feared that their prices would increase further in the coming days due to further spikes in the US dollar prices.

The chairman of Nitol Niloy Group believes sales will reach 10 lakh units by 2025.

Shah Muhammad Ashequr Rahman, head of finance and commercial at Bangladesh Honda Private Limited (BHL), a joint venture between Japan’s Honda Motor Co and the state-owned Bangladesh Steel Engineering Corporation, said their overall sales came down by as much as 40 per cent after August compared to the same period in 2021.

Two-wheeler prices have surged by an average of around 8 per cent following the taka’s depreciation against the US dollar

Rahman believes the price adjustment is one of the factors that reduced sales as the price of Honda motorcycles increased along with the rise in the US dollar prices while peoples’ purchasing power declined amid the ongoing inflation.

He then pointed out that a bike that sold for Tk 150,000 just four months ago is now priced at Tk 175,000.

Rahman went on to say that they previously sold an average of 50,000 units per month, but the number has since come down to 30,000 units for the last four months.

Biplob Kumar Roy, chief executive officer at TVS Auto Bangladesh Limited, the local distributor of India’s TVS Motor Company, said their sales dropped by around 40 per cent over the last few months due to inflationary pressure and an unstable economy.

In addition, there is an impact of the US dollar price increase as the price of bikes increased by around 8 to 10 per cent as a result, he added.

According to Roy, TVS would sell an average of 10,000 units per month before while the number has come down to 8,000 units at present.

Roy then said people are paying more to maintain their basic needs amid the ongoing economic crises and therefore are spending less on luxuries such as personal transport.