The market for expensive high-end bicycles, called `bikes', is set to explode. The premium bicycles, which cost upwards of Rs 25,000 for leisure, health, adventure and environmental reasons, have drawn `bike' freaks in droves these days, in turn helping new players to launch their offerings in the market.
Though exact data on their total sales is not available, the market size of such bicycles in 2013 was estimated at around 25,000 units, according to the industry players. The figure is likely to go up to 30,000-32,000 units in 2014. "There is a change in culture, as far as the cycling is concerned and growing acceptance is seen for the higher-end bicycles, especially within the high net-worth individual (HNI) segment," said Ajit Gandhi, marketing head for Firefox India, which also distributes Trek bicycles.
At present, 7-8 international brands are active in the Indian market and the competition is likely to go up going ahead, as per the players. One of such player, Taiwan-based manufacturer – Giant is betting high on the Indian market.
The company showcased its ultra premium bicycle of worth Rs 11 lakh at the recent Auto Expo in Delhi. The company will soon bring in the most expensive bicycles which will be priced at Rs 13.50 lakh.
Such bicycles are getting popular among the celebrities including Salman Khan, John Abraham and Sanjiv Bajaj.
Dominated by the metros, major markets for these high-end bicycles are Pune, Bangalore, Hyderabad, Chennai and Mumbai. The market however is now moving to smaller cities like Shimla, Chandigarh, Nainital, Indore, Surat etc. "Market in smaller cities is growing by 50-60%, which is on a very smaller base. But there is definitely an increasing potential," said Pravin Patil, managing director and chief executive of Starkenn Sports, which is distributing partner of Giant brand in South Asia.
As of now, most of such bicycles are getting imported in India. Last year, the import duties on such cycles increased to 30% from 10%, which impacted the demand negatively. The total duties paid on an imported bicycle is around 44%. "Although majority sales currently happen in the lower end of the premium cycles, but we are continuously seeing the average selling price of the vehicle going up. 20% of our sales currently comes from bicycles priced above Rs 1 lakh," said Patil.