India’s two-wheeler market is caught up in a high-speed race, with a diverse lineup of models competing for the spotlight. Two-wheeler volume grew 30%, reaching 18.7 million units in FY25, up from 13.8 million units in FY13. 

Over the past decade, Indian two-wheeler manufacturers have launched new models across all segments to stay competitive. Strategic global collaborations have further fueled innovation, enabling Indian players to bring fresh, premium offerings to consumers. 

Hero MotoCorp collaborated with Harley-Davidson to develop the X440 series motorcycles, while TVS partnered with BMW Motorrad to launch premium bikes over 300cc. Similarly, Bajaj Auto joined Triumph Motorcycles to introduce mid-capacity bikes. These partnerships and new launches helped the Indian companies tap the growing demand for mid-capacity and premium bikes.

But the road hasn’t been smooth for Hero. Hero’s pole position has been under threat since 2013, while Honda and TVS Motors are expanding their market presence. Changing consumer preferences, innovative product strategies, and a growing focus on premium motorcycles and electric models are reshaping the industry.

Before Hero and Honda parted ways in 2011, Hero Honda dominated the two-wheeler space with a 68.9% market share. The split created an opportunity for other manufacturers to expand and challenge Hero’s leadership. Today, four major players – Hero MotoCorp, Honda, TVS Motor, and Bajaj Auto – control nearly 80% of the market, and the landscape is shifting fast.

Honda is going after Hero for the top spot. Minoru Kato, Executive Officer at Honda Motor Co., said, “We have launched highly competitive products of all kinds. With the advantage of 6,000 dealers and service networks covering all the geographies of India, we have increased unit sales. Now, the number one position is well within our sight.”

In this edition of Chart of the Week, we analyze Hero MotoCorp’s declining market share, the rise of its competitors, shifting consumer preferences, and the growth of the electric two-wheeler segment.

Hero’s market share dips amid limited product portfolio

Hero MotoCorp has remained India and the world’s largest two-wheeler manufacturer for 24 years. However, its market share declined from 48% in CY13 to 28% in FY25. The company sold 58.9 lakh two-wheelers in FY25, recording a 5.5% increase from the previous year. Hero's sales growth has been slow, with a 5-year CAGR of just 2.2%. In contrast, TVS sales have grown at a CAGR of 14.2% over the same period. 

Hero generates 93% of its revenue from motorcycles, with 80% from just the Splendor and HF Deluxe models. Scooters contribute just 7% to their total revenue. The company faces intense competition from Honda, TVS, and Suzuki. 

Hero is mainly recognized as a commuter brand focused on entry-level motorcycles, making it difficult to establish its credibility in the premium segment, priced above Rs 2 lakh. This positioning has restricted its ability to build a strong brand presence for models above 150cc, as its new models accounted for only 7% of sales in the first nine months of FY25.

TVS Motors has strengthened its market position, increasing its share from 13% in FY13 to 17.4% in FY25. Its scooter market share rose from 32% to 46% during the same period.

TVS maintains a balanced revenue mix, generating 49% of its revenue from motorcycles, 38% from scooters, and the rest from mopeds. In motorcycles, new models have significantly contributed to growth. The Apache series and Raider accounted for 70% of total motorcycle sales, while models launched in 9MFY25 accounted for 20% of the segment’s sales.

TVS gained a foothold in the premium segment early by launching multiple variants in the Apache series in 2016. Hero entered this category in Q3FY25 with six premium models, including the Xpulse 200, Xtreme 160R, and Mavrick 440. Honda holds a 25.3% market share, supported by its presence in both the scooter and motorcycle segments. 

Peers challenge Hero’s rural presence

Hero remains a dominant player in rural markets due to its affordable, fuel-efficient motorcycles designed for local needs, with over 55% of its sales coming from rural areas. Its commuter motorcycles, including the Splendor, Passion, and HF Deluxe, continue to lead the segment. In FY24, the Splendor held a 26.5% market share among commuter bikes, while the HF Deluxe maintained an 8.3% share.

TVS and Bajaj have also expanded their presence in rural India. TVS increased its rural market share from 15.5% in FY18 to 45% in FY24, driven by entry-level models like Star City, Jupiter, and Radeon, priced between Rs 75,000 and Rs 1 lakh. Bajaj's rural market share rose from 12.7% to 13.9% as it focused on entry-level motorcycles. The company introduced Discover, Platina, CT series, and CNG-powered Freedom 125 for rural buyers.

Honda, on the other hand, generates 70% of its sales from urban areas. The Activa remains the top-selling urban commuter model, contributing 38.8% of Honda’s sales. In FY24, Honda sold four Activa scooters every minute. But over the past decade, Honda has expanded its rural and semi-urban network from 1,950 outlets in 2013 to 6,000 in 2025. This growth, supported by models like the Shine 100 and SP125, strengthened its presence in urban and rural markets. 

Royal Enfield leads the shift to premium bikes

A decade ago, the premium motorcycle segment was relatively overlooked. It is now growing rapidly, with more consumers choosing bikes above 250cc for better performance and advanced features. The shift towards aspirational, higher-capacity motorcycles is driven by rising disposable income, a younger demographic, and evolving consumer preferences. 

Royal Enfield continues to dominate the premium motorcycle segment. In the 250–700cc category, it holds an 88.2% market share, led by models like the Classic, Meteor, and Himalayan. 

Bajaj Auto is expanding in the 350–500 cc category through partnerships with KTM and Triumph, introducing models like the KTM 390 and the Bajaj Dominar 400. Hero MotoCorp entered the premium segment in Q3FY25 with six models, including the Karizma XMR and Mavrick, along with collaborations with Harley-Davidson. 

Honda plans to launch three new premium bikes in India next year under the Rebel series through its BigWing network in the 300cc and 500cc segments to compete with Royal Enfield’s dominance in this market.

TVS has also gained traction in the premium segment. Its partnership with BMW Motorrad has increased its motorcycle volume above 310cc, rising from 1.1% of total sales in FY20 to 11.8% in FY24. In the 150–200cc category, TVS holds a 40% market share, led by the Apache series, Ronin, and Commando.

Government push is reshaping the electric two-wheeler segment

India’s electric two-wheeler market grew 33% YoY in CY24 to 19 lakh units. Despite this growth, EVs account for only 5% of total two-wheeler sales. Government initiatives like the Faster Adoption and Manufacturing of Electric Vehicles (FAME) scheme and lower GST rates continue to support adoption, especially in rural and semi-urban areas.

Ola Electric leads the EV segment with a 30% market share and a 1.9% share of the overall two-wheeler market. However, its market share has dropped from 52% in early 2024 to 30% in FY25. Bajaj Auto’s Chetak electric scooter holds a 20% market share, benefiting from the FAME II subsidy, which has helped lower costs and expand its reach.

TVS Motor is the second-largest electric scooter manufacturer, holding a 21% market share. It sold 2.3 lakh iQube in FY25, a 30% year-on-year growth. The company has benefited from the Production-Linked Incentive (PLI) scheme, which supports the iQube scooter and TVS X production.

Hero MotoCorp entered the EV market in late 2022 and has grown rapidly. Management expects support for its Vida electric scooter under the PLI scheme. Vida’s sales surged 174% year-on-year to 48,673 units in FY25. Additionally, Hero owns a 40% stake in Ather Energy. Its sales rose 20% YoY to 1.3 lakh units in FY25, supported by EMPS 2024 incentives.

In Q3FY25, Honda Motorcycle & Scooter entered the EV segment with its Activa E and QC models. The company plans to introduce 30 electric models globally by 2030, signaling its long-term commitment to the space