Explore APAC Two Wheeler Industry - Goldstein Market Intelligence

Goldstein

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Market Intelligence

AUGUST 2020

"EXPLORE" APAC TWO WHEELER INDUSTRY Goldstein Market Intelligence

WRITTEN BY: Dennis Abraham Vice President Goldstein Market Intelligence

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Market Intelligence

INTRODUCTION Asia Pacific automobile industry is fastest growing and is transforming to be a hub of automotive industry. Globally two wheelers are the most accessible & affordable automobile for transportation. But this trend is most evident in Asia Pacific region. The region accounts for nearly 80% two wheelers of all the vehicles on road.

Global two wheeler manufacturers in the past decade have established their manufacturing unit across APAC region.

Asia Pacific two wheeler market s estimated at USD 6.06 billion in 2016. The market is anticipated to grow at a compounded annual growth rate (CAGR) of 6.26% during the forecast period 2016-2024, to reach a market size of USD 123.98billion by the end of 2024.

100 123.98%

125

75100 50

75

76.30%

81.01%

86.03%

91.39%

97.10%

109.66%

103.18%

116.59%

6.26% Global Vehicle

Sales (In million units)

50

CAGR: (2016-2024)

25 25

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20 24

2020

20 23

20 22

20 21

2019

20 20

20 19

20 18

2018

20 17

0

20 16

0

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CHALLENGES TO CONFRONT Enviornmental Challenges Two wheelers, as with all other internal combustion engine-powered vehicles, emit the products of full and partial fuel combustion. Several of these emitted products have been identified as direct or indirect causes of air pollution. A limited number of studies have evaluated the contribution of motorcycles to conventional and toxic urban air pollution inventories and pollutant exposure in Asia.

Motorcycles have been identified as the largest source of particulate emissions at busy traffic intersections, accounting for almost half of the emissions measured.

Moreover, a study of toxic air emissions from vehicles in Bangkok, Thailand found a strong correlation between motorcycle traffic patterns and airborne benzene concentrations.

25% 10.2%

20%

9.1%

9.2%

2010

15% 5.0% 10.8%

1.3%

2.8%

2.7% 1.4%

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Ka ra ch i

Si ng ap or e

N or th

Vi et na m

1.7%

Vi et na m

Ko ng H on g

G ua ng do ng

4.0%

1.9%

0%

Ta iw an

8.9%

3.6%

2.0%

4.5%

So ut h

5%

2015

3.7%

D el hi

7.8%

Ba ng ko k

10%

Share of Total Fuel Consumption by 2S Scooters, 20102015

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Market Intelligence

TRENDS & OPPORTUNITIES Expansion of Two Wheeler Market in South East Asian Countries South East Asian countries also termed as ASEAN bloc, is witnessing huge expansion of two wheeler industry. The elimination of tariffs on imported completely built-up (CBU) vehicles enables OEMs to treat the region as a single market.

Thailand, the region’s biggest manufacturer, wants to raise annual production to 3.5 million units by 2025.

Countries in the bloc are laying favorable conditions for electrification. Thailand is planning tax exemptions for companies who want to manufacture EVs and EV components, and the Philippines will introduce excise duty exemptions for EVs and hybrids. Japanese OEMs continue to dominate the market.

Share of Total Fuel Consumption by 2S Scooters, 2010-2015

2010

2015

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Market Intelligence

FUTURE OF APAC TWO WHEELER INDUSTRY Asia Pacific two wheeler market s estimated at USD 6.06 billion in 2016. The market is anticipated to grow at a compounded annual growth rate (CAGR) of 6.26% during the forecast period 2016-2024, to reach a market size of USD 123.98billion by the end of 2024.

The two wheeler sales is highest in India & China on account of being the two largest & developing economies in Asia Pacific. But the Southeast Asian countries including Thailand, Vietnam, Indonesia, Malaysia, Philippines and Bangladesh have huge penetration of two wheelers. Nearly nine out of every ten households own a two wheeler.

The presence of huge population in APAC region with majority falling in the low income to middle income category. Thus the adoption of two wheelers is the most affordable and wise choice across the region. Hence the market players recorded huge sales over the past decade.

But rising per capita income of people in nearly every country in Asia Pacific, is thus registering a shift in automotive preference. People are shifting towards buying entry level passenger cars. Such changing environment is anticipated to bring stagnation in the growth of two wheeler industry in near future.

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Scan the QR code or click the link below for our study on future of automotive industry. https://bit.ly/3iFfuGj

About the author Dennis Abraham Ph.D, senior vice president at Goldstein Market Intelligence, leads GMI's syndicated health and wellness research. Before joining Goldstein Market Intelligence, Dennis held a variety of senior leadership positions in global and regional consulting roles covering consumer and retail insights across a broad range of healthcare categories. Dennis has been providing crosscategory strategic insights to healthcare brands for over 12 years on topics including digital disruption, ecommerce, and healthcare technology. Dennis holds a Ph.d from Havard University.

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About Goldstein Market Intelligence Goldstein Market Intelligence helping businesses to be successful at strategy and take informed decisions to grow the business in future. Goldstein Market Intelligence is one of the leading professional services firms, providing Intelligence Services, Consulting & Advisory and research related services to clients. We, at Goldstein Market Intelligence practice works side by side with chief executives and their teams to create effective strategies and secure alignment across the organisation. ŠGOLDSTEIN MARKET INTELLIGENCE

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