2-wheeler sales pick up after firms accept cards
Business that had come to a standstill after the note ban has finally picked up at two-wheeler dealerships.business Updated: Nov 29, 2016 13:04 IST
Business that had come to a standstill after the note ban has finally picked up at two-wheeler dealerships.
Now, buyers are returning as firms are taking digital payments. They have also asked banks to lower interest rates, and eliminate transaction fees. The government’s measures have also helped.
At Hero MotoCorp dealerships, footfall had fallen to 15% as compared to October. “The footfall has gone up to almost 85% of the normal level,” said Pawan Kant Munjal, chairman, CEO and MD of Hero MotoCorp.
It partnered with Payzapp, HDFC Bank’s online payment solution, to take bookings online. Hero FinCorp also worked closely with dealers to give loans to prospective buyers. It has waived 2% service charge on card payments.
“Almost 40-45% of two-wheeler sales are made in cash as most bikes are sold in rural areas,” said Himanshu Sharma, auto analyst at Centrum Broking.
For its biggest rival Honda Motorcycles and Scooters (HMSI), too, footfall fell below 50% as compared to October.
The firm was quick to embrace plastic money, but it is yet to reach October figures. “In western and eastern India, we have reached 90% of previous sales. But in north and central India, where the economy is largely agrarian, sales are at 60% of normal,” said Yadvinder S Guleria, head of sales and marketing at HMSI.
In some places, where dealerships did not have swiping machines, teams from HMSI educated dealers. They have also started accepting payments on Paytm. “We negotiated with bankers to reduced transaction fee... The credit cycle has also been increased from six weeks to eight weeks,” said Guleria.
Munjal also said that the slew of measures implemented by the government helped improving the situation.
Others two-wheeler makers, too, witnessed a spurt in sales. “In the initial days the sales went down, but have now returned back to 90% of what is usually is,” said Suresh Babu, head of product planning and marketing at Suzuki Motorcycle India.