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Riders 26
WHEN YOU'RE ON THE BACK OF a 900 CC BMW R90/6 GOING full speed
underneath a Sunday morning menacing sky, holding on by locked thumbs to a
boot‐clad, black‐leathered.
The Pew Research Center conducted a survey last year, asking people in 44 countries whether
they owned a car, a motorcycle, or a bike. They sorted the results in an interactive chart (part of
which is embedded below) that reveals global trends in vehicle ownership.
When it comes to cars, Italy tops the list: 89 percent of Italian survey respondents reported
owning one. America trailed closely behind with 88 percent. In general, developed countries
showed a high rate of car ownership. In Europe, for example, the median national share of car
owners was 79 percent.
Developed Asian countries like South Korea and Japan also reported high car ownership (83
percent and 81 percent respectively). But in other South and Southeast Asian countries, the
proportion of car owners was incredibly low. In Bangladesh, for example, only 2 percent
reported having a car.
In the 44 countries surveyed, more people had bikes than cars: the median for car ownership was
one-third; while for bike ownership, it was around 42 percent. Germany topped the list of bike-
owning countries, with 80 percent of respondents owning bikes—way more than the United
States, where only 53 percent owned bikes.
In emerging markets like Vietnam, Chile, China and Indonesia, around two-thirds of the
population owned bikes. But within these emerging economies, bike-ownership was not
positively associated with income the way it was in developed countries. Pew had a possible
explanation.
The three means of transport, motorcycles were the least common. The survey found a high
concentration of them in South and Southeast Asia, probably because they're not very expensive
in these places. Some eight in 10 people in Thailand, Vietnam, Indonesia, and Malaysia reported
owning one.
Import duty of motorcycles with engine capacity of 800 cc and above used to attract 75 per cent
duty. The import duty reduction is only applicable on motorcycles which are full imports - which
are brought in as completely built units (CBUs).
Imported motorcycles are expected to become less expensive after the government slashed
customs duty to 50 per cent. So far, imported motorcycles with engine capacity of 800 cc or less
used to attract 60 per cent duty, while those with capacity of 800 cc or more attracted 75 per cent
duty. The Central Board of Excise and Customs (CBEC), through a notification on February 12,
has slashed the duty on both these variants of motorcycles imported as completely built units
(CBUs) to 50 per cent.
According to the CBEC notification, import duty on engine, gearbox, or transmission mechanism
as a completely knocked down (CKD) kit in pre-assembled form of motorcycles, not mounted on
body assembly, has been reduced to 25 per cent. These pre-assembled parts attracted customs
duty of 30 per cent earlier. Meanwhile, to promote local assembling, the CBEC has hiked
customs duty to 15 per cent on import of engine, gearbox and transmission mechanism which are
not pre-assembled. The duty on these was 10 per cent earlier.
Canard bike tried to reach out to a few premium motorcycle brands, but so far, there's been no
concrete announcement on which bikes will become less expensive and what will be the cost
advantage to the customer. The understanding right now is that full imports, (or CBU bikes) will
become less expensive, so motorcycles from Indian Motorcycle, BMW Motored and Aprilia are
expected to become cheaper as certain models from Kawasaki, Suzuki and Yamaha, which are
not assembled in India.
Brands like Triumph and Ducati have very few fully imported models, so the more popular
Ducati and Triumph models may not see any significant price advantage at all. In fact, most of
the Ducati models sold in India are manufactured in Thailand and are imported under the Free
Trade Agreement (FTA) with Thailand, which gives a price advantage to Indian customers. The
latest import duty slash may not affect prices under the FTA. Harley-Davidson maintained that
it's too early to calculate what price implications the announcement will have on models offered
on sale in India, but the understanding is that only full imports from the US will become less
expensive. Most brands maintain they are yet to study the implications of the announcement and
then calculate, if at all there will be cost benefits to customers, and on which models.
Global sales from motorcycle exports by country totaled US$28.2 billion in 2018.
Overall, the value of motorcycle exports rose by an average 29.4% for all exporting countries
since 2014 when motorcycle shipments were valued at $21.8 billion. Year over the value of
exported motorcycles appreciated 13.3% from 2017 to 2018.
Among continents, Asian countries sold the highest dollar worth of exported motorcycles during
2018 with shipments valued at $16.8 billion or 59.5% of the global total. In second place were
European exporters at 34.2% while 5.1% of worldwide motorcycle shipments originated from
North America.
Smaller percentages came from Latin America (0.6%) excluding Mexico but including the
Caribbean, Africa (0.11%) and Oceania (0.09%) mostly Australia and New Zealand.
For research purposes, the 4-digit Harmonized Tariff System code prefix is 8711 for motorcycles
including mopeds and cycles fitted with an auxiliary motor. This includes motorcycles with or
without side-cars.
COUNTRIES
Below are the 15 countries that exported the highest dollar value worth of motorcycles during
2018.
The listed 15 countries shipped 92.8% of global motorcycle exports in 2018 by value.
Among the top exporters, the fastest-growing motorcycles exporters since 2014 were: Hungary
(up 1,633%), Indonesia (up 669.9%), Netherlands (up 168.7%) and Austria (up 56.5%).
Two top countries posted declines in their exported motorcycles sales namely United States
(down -9.9%) and Vietnam (down -6.7%).
ADVANTAGES
The following countries posted the highest positive net exports for motorcycles during 2018.
Investopedia defines net exports as the value of a country’s total exports minus the value of its
total imports. Thus, the statistics below present the surplus between the value of each country’s
exported motorcycles and its import purchases for that same commodity.
China has the highest surplus in the international trade of motorcycles. In turn, this positive cash
flow confirms strong Chinese competitive advantage for this specific product category.
OPPORTUNITIES
The following countries posted the highest negative net exports for motorcycles during 2018.
Investopedia defines net exports as the value of a country’s total exports minus the value of its
total imports. Thus, the statistics below present the deficit between the value of each country’s
imported motorcycle purchases and its exports for that same commodity.
1. United States: -US$1.5 billion (net export deficit up 108.1% since 2014)
2. Philippines: -$1.3 billion (up 249.4%)
3. France: -$1.2 billion (up 28.2%)
4. Spain: -$641.3 million (up 97%)
5. Nigeria: -$594.4 million (down -40.9%)
6. Argentina: -$502.4 million (up 65.4%)
7. United Kingdom: -$501.4 million (up 35.3%)
8. Australia: -$473.4 million (down -12.8%)
9. Switzerland: -$428.2 million (up 28.6%)
10. Myanmar (Burma): -$377.7 million (up 43.3%)
11. Canada: -$373.8 million (up 42.3%)
12. Bangladesh: -$333.3 million (no 2014 data)
13. South Korea: -$303.2 million (up 153.5%)
14. Mexico: -$286.4 million (down -11.4%)
15. Togo: -$255 million (up 1636.2%)
Overtaking France in 2018, the United States of America incurred the highest deficit in the
international trade of motorcycles. In turn, this negative cash flow highlights America’s strong
competitive disadvantage for this specific product category but also signals opportunities for
motorcycle-supplying countries that help satisfy the powerful demand.
COMPANIES
Below are global motorcycle makers that represent established players engaged in the
international motorcycle trade? The home country for each company’s headquarters are shown
within parenthesis.
%WORLD
RANK EXPORTER EXPORTED MOTORCYCLES (US$)
TOTAL
An increasing number of superbike makers are working out plans to localize production as it
would help them significantly cut down on prices when demand is growing at a fast clip. They
are encouraged by the success of local manufacturing for luxury car companies, for whom more
than half the sales now come from locally assembled models.
The Indian super bike market has expanded exponentially, albeit on a smaller base, with
manufacturers struggling to meet demand. According to the Society of Indian Automobile
Manufacturers, sales of bikes with engine capacity of 500cc and above jumped nearly threefold
to 9,130 units in the year ended on March 31, 2015 from 3,424 in the previous year.
While market leaders like American Harley-Davidson and British classic bike maker Triumph,
as well as Japanese Kawasaki, are already assembling several of their models at their Indian
factories, others like Honda Motor and Suzuki, Motorcycle, who sell a sizeable number of
superbikes in India, are also working on plans to assemble high end bikes here.
India levies a lower rate of tax on locally assembled vehicles compared with those imported as
fully built units. Luxury cars such as Mercedes-Benz S-Class became cheaper by as much as Rs
30 lakh when its German manufacturer started assembling them them in India. Recently, Tata
Motors’ British unit Jaguar Land Rover started assembling its Range Rover Eloqua in India,
which helped it cut the vehicle’s price by about Rs 20 lakh to Rs 48.73 lakh.
The stylish Range Rover Eloqua, when imported as a completely built unit, attracted over 170%
in taxes and other duties. Local production reduced the levies to about half. Suzuki, which leads
the superbike segment with its legendary Hayabusa, is aiming to knock off a substantial portion
of its price with local assembly. World’s largest two-wheeler maker, Honda, plans to roll out its
new CBR 650R from one of its three plants in India.
“Customer needs in India are evolving. We are all set to grab the opportunity with our new
product line-up,” said Keita Muramatsu, president and CEO of Honda Motorcycle & Scooter
India. The bike, “our biggest ‘made in India’ motorcycle”, will also be exported from here, he
said. Suzuki’s Hayabusa, which is currently sold at Rs 15.95 lakh in Delhi before local levies and
insurance, would be assembled at the company’s Manesar plant in Haryana
References
https://www.google.com/search?q=international+trade+of+super+bikes+dessitration+report&s
xsrf=ACYBGNQVVzc8dsrx5li3to8tMIyi3Nx06g:1571844930961&tbm
https://en.wikipedia.org/wiki/Superbike_World_Championship
https://scholar.google.com/scholar?hl=en&as_sdt=0%2C5&q=super+bikes&btnG
Forbes Global 2000 rankings, The World’s Biggest Public Companies. Accessed on May
18, 2019
Investopedia, Net Exports Definition. Accessed on May 18, 2019
The World Fact book, Field Listing: Exports – Commodities, Central Intelligence Agency.
Accessed on May 18, 2019
Trade Map, International Trade Centre. Accessed on August 9, 2019
Wikipedia, List of motorcycle manufacturers. Accessed on June 2, 2018
https://auto.ndtv.com/news/imported-bikes-to-get-cheaper-as-govt-slashes-import-duty-
1812334
https://www.citylab.com/transportation/2015/04/global-car-motorcycle-and-bike-ownership-
in-1-infographic/390777/
https://economictimes.indiatimes.com/more-superbike-makers-plan-to-make-in-india-as-sales-
rise/articleshow/47020759.cms?from=mdr