Several friends and colleagues have forwarded me an article by Srinivas Kantheti, in CNBCTV18 titled “How one Indian industry beat China at manufacturing and creating a global footprint". It is an excellent piece that explains how India’s two-wheeler industry has 'overtaken' that of China, and why a combination of government, people and corporates made it happen. I agree and subscribe to most of what Kantheti writes; yet, there are some facts, figures and realities which need clarification.
In 2019-20, India made more than 21 million two-wheelers (including electric ones) and a tad over 1.13 million three wheelers (including electric). These figures are from the Society of Indian Automobile Manufacturers (SIAM). China manufactured a little over 17.36 million two-and three-wheelers (15.43 two-wheelers, 1.93 million three-wheeled vehicles) during the calendar year 2019, as per data from the Chinese Ministry of Industry and Information Technology (MIIT). These figures indicate that India has overtaken China.
There is another, more important figure though, that needs looking at: China produced 27.07 million electric two-wheelers in 2019! Though these figures include pedal-assisted electric bicycles (with max speed of up to 20 km/hr), most are light electric scooters and 'scooterettes', as well as higher performance motorcycles.
With the ban on use of fossil-fuel-powered two-wheelers in most major cities of China, commuters have been forced to switch to cleaner, electric-powered vehicles. Thus, as China has moved to cleaner two-wheelers, India is leading the charge of the unclean ones. The reality is that India remains far behind China, when it comes to the overall count.
The situation is similar with regard to exports too. Whilst India exported a little over four million two- and three-wheelers during 2019-20 (of which 3.5 million were two-wheeled), China sold over 7.125million units (worth US $4.8 billion) in international markets during 2019 (a figure, which has seen steady decline since 2013, when around 10 million were exported).
To these figures, we need to add the export of electric two-wheelers. In 2018, China exported 1.877 million e-bikes, with a total export volume of US $790 million (about 5.23 billion yuan), up 14.6% year-on-year (y-o-y). In 2019, China exported more than 14 million e-bikes of which 3.4 million were to Europe alone–valued at US $ 2.89 Billion!
Even more importantly though, China exports a massive number of components – in 2013, China exported more than 26 million two-wheeler engines worldwide!
Unfortunately, many of them made their way to India. The numbers though have been coming down, yet India, sadly, imports a significant number of components from China.
In fact, most of India’s electric two- and three-wheeler industry is China-based, with most of the start-ups making and selling essentially China-sourced vehicles, which have been superficially 're-clothed'.
Whereas, China buys almost nothing from India.
Historically, the Indian governments, sometimes through good planning, sometimes thanks to exigencies, have managed to provide enough protection to the budding Indian two-wheeler industry. All this happened over time, and then there was the right dose of competition to make the Indian motorcycle industry a 'world class' act.
No doubt, credit should also go to the India’s bike industry, its captains, engineers and designers for being both, progressive and aggressive. This is why Europe’s two leading motorcycle manufacturers, KTM and BMW, have partnered with Indian giants Bajaj and TVS, with Bajaj now controlling 49% of KTM. This is also why English motorcycle magazines are happy that venerable British bike brands, BSA and Norton are in the hands of Indian giants, Mahindra and TVS. (China too has been on a buying spree, having acquired famous Italian marques Benelli, Moto Morini and several others).
Yet, before we go around patting our collective backs, we must realise that the future is electric and not fossil-fuelled and that the current Indian government’s moves on this front has opened an extremely wide door to the Chinese.
The government’s policy on automotive electrification has created a situation where a fully indigenous effort does not have the slightest chance of making it in the Indian marketplace, let alone international.
Thus, before hubris sets in, it is time the government sat with industry and worked out a mutually beneficial strategic plan, if we really want to become the world’s largest manufacturer of (all) powered two-wheelers.
(Author of several automotive books, founder editor of many leading auto mags, Gautam Sen has also consulted with most of the Indian auto majors. He has also worked with several leading car designers such as Gérard Godfroy, Tom Tjaarda and Marcello Gandini, among others