The global two-wheeler market, which includes motorcycles, scooters, and mopeds, is expected to reach over 700 million units by 2021. This is a high-growth market segment, increasing at a rate of 8% per annum. Rising economic conditions, lack of public transportation, poor road infrastructure, high fuel efficiency/ mileage, lower emissions, and growth in the young population are the leading drivers for this significant uptick in demand. As a result of these trends, countries like Brazil, India, and Vietnam are at the forefront of driving demand for two-wheelers. However, as electric two-wheelers gain prominence in Southeast Asian countries, lubricant demand growth may be subdued.
Despite the penetration of electric two wheelers, the current situation shows tremendous growth potential in this market since conventional four-stroke two-wheelers remain the vehicle of choice for a majority of the market.
Motorcycles represent a major market in Brazil. The fleet of motorcycles posted an impressive growth in the last decade increasing from 15% of total vehicles fleet in 2003, to over 32% of all vehicles in the country in 2013. This expansion occurred mainly due to three factors: the entrance of new consumers in the motorized market; the need for more agile transportation to escape from increasing traffic jams in urban areas; and the replacement of animal transportation in rural areas. Additionally, positive points, such as saving money on fuel, easy parking, and speed of locomotion are driving the growth of the motorcycle culture across the country, particularly in large urban centers where 40% of new consumers are former users of public transport.
In Vietnam, the total number of motorcycles registered in the country is approximately 35 million in 2012, an increase of 9.7% from 2011. Presently, the motorcycle population continues to grow by roughly 7% and reaches over 37 million individuals despite government regulations and the desire to shift towards automobiles. This market represents a CAGR of approximately 12.5% from 2005. The high penetration of motorcycles is the leading cause of traffic jams in the major cities of Vietnam. In addition, motorcycles play a major role in a large number of road accidents. This phenomenon has prompted the government to impose certain policies that limit the registration of motorcycles in the major cities, as well as seven additional provinces, in recent years.
In other developing economies similar internal factors have led to the growth in demand for two-wheelers. These vehicles are capable of filling the need for consumers seeking to have a vehicle that efficiently serves as a basic means of transportation. Mopeds are pervasive in developing markets because infrastructure is best suited for the use of compact two-wheeled vehicles. Economically, these vehicles provide a sufficient means of travel.
Two-wheeler usage and consumer behavior towards maintenance and lubricant brand choice and type varies considerably and can be analyzed across four distinct groups.
- Recreational owners who take pride in maintaining their vehicles appearance and condition and will only choose the best lubricant brand regardless of price. These owners are likely to strictly follow OEM recommendations, ride their vehicles in only the best weather conditions, and exhibit a high degree of supplier loyalty. Annual mileage accumulation would be low.
- Commuter owners rely on their vehicles as a primary means of transportation with reliability the most important factor driving their choices. These owners will typically follow OEM recommendations for maintenance and lubricants to ensure the vehicle gets them to work or school with the goal of reducing or eliminating any unscheduled maintenance stops and downtime. Commuter owners may compromise and use a mid tier brand to save money. Annual mileage accumulation would be medium to high for this group.
- Business owners/users rely on their vehicles for a variety of commercial activities from taxi and pay for transport to intra-city delivery services. These owners expose their vehicles to daily or 24 hour operating conditions such as stop and go driving, start/stop operation, high mileage, and multiple operators with minimal regard for the vehicle as they may not be the primary owner. Vehicles may be a mix of newly purchased and second or third hand ownership. Given the operating conditions and frequent oil drain intervals; lubricant brands and quality levels may be compromised and loyalty the weakest among these groups. Annual mileage accumulation would be high for this group.
- Sport/competition owners that use their vehicles for organized and un-organized on and off road racing activities. Lubricant product quality is extremely important and this group is the most likely to use synthetic products meeting the latest OEM and industry recommendations.
These segments besides the overall market will be examined in detail in Kline’s Lubricants for Motorcycles, Scooters, and Mopeds: Global Market Analysis and Opportunities report, set to be published by the end of 2015. This report will provide a detailed independent appraisal of this fast-moving market, including current and forecast demand by lubricant type, leading countries, and regions.