When the BS-VI emission norms come into effect in 2020, the 150 cc bikes will be in the same price bracket as the 350 cc machines speculatively
The upcoming BS-VI emission norms and industry regulations will result in increase of commuter motorcycle prices in India by a considerable amount. According to a recent report, from next year, the arrival of mandatory ABS for all bikes of 125 cc and above capacity, and on-board diagnostics along with new emission standards in 2020 will increase the prices of 150-180 cc bikes to be in the vicinity of 350 cc entry-level Royal Enfield motorcycles.
The delta rupee cost will almost be similar for all and it will result in small capacity bikes enduring price hikes. When the BS-VI emission norms come into effect in 2020, the 150 cc bikes will be in the same price bracket as the 350 cc machines speculatively. ICRA, a research and rating agency, has evaluated that an increase of 20 percent in cost of two-wheelers is highly possible when the stringent environmental-friendly regulations become legal.
The major reasons for the price jump are due to two-wheelers manufacturers bearing down several new processes in order to achieve the requirement emissions. Installation of on-board diagnostics alongside changes to the mechanical components and fuel injection will add up to the predicted 20 percent price hike. Royal Enfield expects loss of demand for some time, despite making moves to expand its presence in India with increased distribution chain and ramped up production.
The volume sales of 150-200 cc motorcycles were on the rise last year by 43 percent with 8.45 lakh units sold. Both the bike as well as scooter industry are posting steady numbers recently and on the other end of the spectrum, the demand for premium bikes are also going high. A state of volume sales decline is also predicted by Honda across the industry following the introduction of new standards.
With over 20 models in the 150-200 cc space from top brands currently, the increase in retail price due to oncoming regulations cannot be avoided. ABS becomes mandatory from April next year while BS-VI will be implemented from April 2020. Ahead of their introductions, however, we can expect big discounts from manufacturers to clear the stocks.