The Indian entity of the Swiss bicycle maker Scott Sports India plans to expand its dealership network from 120 at present to 150 in FY23.
Currently, the company has a presence across 80 cities in the country in metro and Tier-I cities. With the expansion plan, it plans to expand its reach to the Tier-II cities.
Speaking to Mobility Outlook, Jaymin Shah, Country Manager, Scott Sports India, said, “We’re getting a lot of traction in the Tier-II cities including Siliguri, Ahmednagar, Vyara and Kayamkulam among others.”
In February 2022, the company announced the launch of its new sub-brand, the Australian bicycle maker Avanti, which Scott Sports acquired five years ago.
The company now retails bicycles and e-bicycles from three brands - Scott Sports India, Bergamont and Avanti. Besides, the company also has a range of accessories.
Given the expansion plan, Shah noted that the company believes that there is much potential for Avanti and Bergamont brands in the emerging market. He continued that these brands will also act as a stepping stone for the consumers of Scott Sports India products.
Combined with all the three brands, the e-bicycle brand currently retails around 75 units, with prices ranging from INR 20,000 for the Avanti bikes range going up to INR 5.5 lakh for the Scott Sports range.
During the last five years since the brand introduced the e-cycle range in India, it has seen 42% of its total sales coming from e-cycles, which is higher than the industry average of 40%. “Our average sales price has, over the last few years grown from INR 20,000 to about INR 48,000 today,” the Country Manager noted.
He added that during the last 12 years of its operations, the company has grown at 48% CAGR. The company aims to grow at a rate of 40% YoY during the next five years.
The products are currently being imported from Cambodia and Vietnam, Shah said and added that it is looking for contract assembly plants in India. However, he continued that the major challenge in producing e-cycles in India is the lack of suppliers for alloy frames.
“We see a cycle valley coming up, and hopefully, with better alloy frame manufacturers, that challenge should be over in the next few years,” he said.
However, he continued that until suitable component suppliers are found in India, the government should lower the import duty, which is currently at 40% for e-bicycles. Citing the example of European nations and America, he said lowering the import duty would mean that more people can afford e-cycles hence solving the traffic problem in a country like India.
“Replacing ICE vehicles with EVs would surely lower down the pollution level, but the major issue of traffic congestion would still remain,” Shah said.
Road Ahead
Apart from setting up a contract assembly facility in India, the company aims to set up Avanti as an established brand and expand its customer base across the country. Alongside, it also aims to invest in retail infrastructure, including training the mechanics. At present, its dealerships also act as a service facility for its customers. With the expansion of dealerships, Scott Sports India also plans to expand its service facilities across India.
While for the long term, it aims to promote cycling in the country. It plans to re-introduce its weekend rides and technical service workshops initiatives, among others.