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Monday, September 21, 2020

0 to 8 lakh units in 3 months: Bicycle industry pedals on to turn the tide

As India entered Unlock 1.0 in June, manufacturing got another push, reaching 8 lakh units in June, almost doubling since May. With a single shift, and 40-60 per cent work force, the bicycle industry is fighting back to make up for the losses it incurred during lockdown.

Written by Raakhi Jagga | Ludhiana | Updated: July 21, 2020 11:06:15 am
coronavirus lockdown, Bicycle industry pedals, Ludhiana news, Punjab news, Indian express news However, if these figures are compared with 2019’s first quarter, the difference is huge. In April 2019, 10.3 lakh bicycles were manufactured by AICMA members, as compared to none in April 2020 because of lockdown in the country. (Representational)

From zero production in April this year, India’s bicycle industry — of which Ludhiana is a major hub — reached 4.5 lakh units in May as government started easing lockdown restrictions.

As India entered Unlock 1.0 in June, manufacturing got another push, reaching 8 lakh units in June, almost doubling since May. With a single shift, and 40-60 per cent work force, the bicycle industry is fighting back to make up for the losses it incurred during lockdown.

“Demand is huge but due to social distancing norms and less manpower (as majority migrated to their home states), we are working in a limited manner,” said Onkar Singh Pahwa, president of the All India Bicycle Manufacturers Association (AICMA) and CMD of Avon cycles Private Limited, while talking to The Indian Express.

However, if these figures are compared with 2019’s first quarter, the difference is huge. In April 2019, 10.3 lakh bicycles were manufactured by AICMA members, as compared to none in April 2020 because of lockdown in the country. In May 2019, AICMA members manufactured 11 lakh bicycles compared to 4.5 lakh in May 2020 and in June 2019, a total of 14.3 lakh bicycles were manufactured compared to 8 lakh in June this year. Hence, compared to the April-June quarter of 2019, when 35.6 lakh bicycles were manufactured. In the current quarter, 12.5 lakh bicycles have been manufactured — about one-third as compared to the same period last year.

Dr K B Thakur, general secretary of AICMA, said, “In 2019, conditions were different. We have never experienced anything like this pandemic in our entire career and hence the loss is also visible. But at the same time, one needs to see how the industry is slowly fighting back and coming out of it as we made 8 lakh bicycles in June compared to 4.5 lakh in May. This is a positive move despite the tough challenges being faced by the industry.”

Pahwa said, “We are still manufacturing bicycles in a single shift as small industries which supply bicycle parts to us are struggling with labour shortage. Moreover, we started with 35 per cent production in our units and now have reached 60 per cent.”

He added, “Forty per cent of our total sales used to be institutional sales i.e bicycles ordered by various states used to be distributed free of cost to girls, SC students from class 9 onwards under various schemes. However, this year, schools are closed, so we have got no orders from various state governments. Hence this difference in bicycle manufacturing will remain till the time institutional sales is not started.”

Gurmeet Singh Kular, president of Federation of Industrial and Commercial Organisation (FICO), which supplies parts to Avon Cycles said, “My two units are working at 40 per cent work force. All the workers have not yet turned back from their home states. They went in lakhs and came back in a few thousands. Moreover, we are also in deep losses and hence we cannot support salaries of 100 per cent staff. Hence, as of now we are okay with what we are doing. The difference of April-June 2019 and April-June 2020 shows how much the bicycle industry has suffered. Hence, we need to reduce our costs for a few months.”

He added, “Every month, around 4 lakh bicycles used to be manufactured for different state governments.”

Meanwhile, the Union Ministry of Housing and Urban Affairs has launched the ‘India Cycles4Change Challenge’ with an aim to create cycle-friendly cities across the country. An advisory issued by Union ministry says that “cycling can give a green recovery from Covid-19 for the transport sector and create a golden age for active, sustainable and efficient travel in our cities”.

The challenge will take place in two stages — stage one will run until October where cities will focus on quick interventions to promote cycling and developing a scale-up strategy. In October 2020, 11 cities will receive Rs 1 crore each and guidance from national and international exports to further scale up initiatives in stage two which will continue till May 2021.

Thakur said, “These challenges are a big opening for us and we can expect a further surge in demand in coming months. The need of personalised transport is expected to increase due to Covid-19. A recent survey by ITDP indicated that cycling would increase by 60-65 per cent as cities come out of lockdown. This demand is increasing world over.”

Cycling for short distancing can earn an annual benefit of Rs 1.8 trillion to the Indian economy, said the advisory issued by Ministry of Housing and Urban Affairs on July 10. Meanwhile, this challenge is open for all those cities which have a population of more than 5 lakh and eligible cities can submit applications from July 10- July 21, said the advisory.

Hence, the bicycle industry is hopeful of getting bulk orders from state governments in the coming months as they will promote bicycling as part of the challenge. Meanwhile, there is an increase in demand for the premium, semi-premium and recreational bike categories. However in May, demand was more for bicycle parts of black roadster bicycle as many got them repaired and went via cycles to their villages. Gradually, there was more demand from the urban sector as well, said manufacturers.

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