Covid-19 impact: Hero Cycles expects market share to grow by 50%
Leading bicycle maker Hero Cycles expects to increase its market share in India to 45-50 per cent in the current financial year, despite the slowdown caused by the coronavirus pandemic and the nationwide lockdown.
In an interview with IANS, Pankaj M Munjal, Chairman and Managing Director, Hero Motors Company - of which Hero Cycles is a group company, said that sales in India during the lockdown took a big hit but since June 8, when the restrictions were by and large lifted, sales have picked up.
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"It's difficult to cope up 100 per cent lost sales of Q1 (April-June) but we are hopeful that we will cover most of it consolidating our market share to 45-50 per cent this year, up from 40 per cent March 2020," he said.
Munjal, however, noted that during the lockdown period, unlike in India, demand increased for the company's cycles in Europe. "In fact the demand was greater than the supply, because no one expected a spike so sudden and tall," the CMD told IANS.
On the company's plans in the electric cycles' segment, he said that although the "electronic revolution" in India has been slow, over the past one year there has been growth in the segment and Hero Cycles expects to double the sales of its e-bikes this fiscal.
In just two years, the company has sold nearly 25,000 units, he said.
"E-cycles' penetration today increased to 200 cities and expected to grow to 250 to 300 within this financial year as well. We are also hoping to double the sales of our e-bikes in FY 2020."
The bicycle industry leader also hoped that with the growing trend of environmental consciousness amongst consumers, e-bikes or e-cycles will be looked as a more eco-friendly, economical, non-motorised, personalised alternate mode of travel.
As the lockdown gets lifted in phases, Munjal was of the view that the cycle industry and the demand scenario in the market will pick up faster compared to other sectors.
Further, given shared mobility for transportation and gyms for fitness requirements are unlikely to be preferred soon in the near future, people may opt for cycles and e-cycles as an alternative both for fitness and commuting, he said.
Asked about any delay in strategic decisions and planned operations due to the lockdown, he admitted that there has been "a slight delay". He said that the Hero Industrial Park that the company is building in Ludhiana, where Hero Cycles is based, has fallen a bit behind schedule.
"Hero Industrial Park that we are working on got halted because of the Covid situation. Since the lockdown is nearly lifted, we are trying to put things back on track and complete construction by September and start production by Q4 FY 2020," he said.
Munjal added that there are no other plans which have seen a major course correction.
The Hero Motors Company CMD told IANS that in the wake of the unanticipated Covid crisis the company is trying to curtail any extra cost by making the value chain more efficient.
He also said that Hero Cycles is supporting its dealers with extended credit periods and other support that they may require to continue operations and be back in business.