My thoughts as Angel Investor on Two-Wheeler sales CAGR being flat over 10 years

One of my friends reached out to me to get my thoughts on why there has been no growth in the two-wheeler industry even though it sounds counter intuitive as I am sure established players must be doing their best to grow their business but there must be some bumps and challenges including macroeconomic factors

I must confess that I am not in any ways connected to this industry and my comments are using the filter of an angel investor in startups as that’s what I have been doing for last 4 years.

1. The two-wheeler companies like many others have not tried to disrupt their business model around convenience, offerings basis customer insights (data science), expanding the market, cost optimisation and features in line with the ability to pay, innovative marketing etc.

2. They are still selling products and not solutions around different use cases.

3. Financing solutions, to meet customer cash flows while using risk mitigation tools.

4. Young consumers are more focussed on access vs ownership.

5. Community building and engagement as a tool to get insights.

6.Hunger to scale exponentially and drive to think out of the box, being agile to changing customer and people preferences.

7. Building alliances and treat ecosystem stakeholders as equal partners. The companies have to believe and walk the talk that they exist because of their partners and not the other way round.

8. Even though only marginal impact of EV adoption but over time this will increase, and many new players will drive growth. Are these guys ready to change process for making intelligent EVs.

9. Covid, oil price increase, lower disposable income, inflation etc. The impact may be more pronounced in rural areas as 50% of sales come from there.

Please take these reflections given that I have used the filter of start-ups and my limited understanding of this space.

May 2023