The global two-wheeler population is estimated to increase at a CAGR of over 5% through 2022, with the highest growth coming from Asia-Pacific. Consequently, the total demand for motorcycle oils (MCO) is forecast to grow strong at a CAGR of 3.5% during the same period. Three-fourths of the total MCO demand comes from Asia-Pacific, where four countries—India, China, Indonesia, and Thailand—combined account for more than half of the total MCO demand globally, finds Kline’s recently published Lubricants for Motorcycles, Scooters, and Mopeds: Global Market Analysis and Opportunities report.
Most markets in the region are still low-end in terms of lubricants quality, but are rapidly embracing semisynthetic products, making them attractive in terms of profitability. Europe has the highest penetration of synthetic and semisynthetic products in percentage terms as they account for almost 80% of the total two-wheeler engine oil demand in the region. Although penetration of synthetics and semisynthetics in Asia-Pacific is low, it still accounts for a major share of the global synthetic and semisynthetic volume. OEM genuine oil brands hold the majority share of the high-performance market, signifying that OEM recommendations or endorsements are imperative to gaining market share in the semisynthetic and synthetic products segments, according to the report.
The inability of passenger cars to access narrow roads, bad road conditions, and weak public transportation systems are supporting the growth of bike taxis. As a result, usage of two-wheelers for commercial transportation is becoming increasing popular as they provide last mile connectivity to the rising urban population in developing countries. For instance, in India, mobile app-based transportation service providers, such as Uber and Ola Cabs, have launched bike taxis in a few cities to ease urban transportation in high-density traffic areas. With the advent of e-commerce, the number of two-wheelers used for delivery services has also increased tremendously, driving the usage for commercial purposes, the report continues.
“The commercial segment is a high-mileage segment that changes lubricants more frequently than the personal-use two-wheelers segment,” comments Sushmita Dutta, the report’s Project Manager. “Thus, it provides an attractive opportunity to lubricant suppliers. However, brand loyalty is low and product quality decision may be disproportionally influenced by price.”
Due to the ease of transportation, the percentage of female riders in the two-wheeler market is increasing, resulting in growth in the scooters segment. Particularly, scooters with automatic transmission are the preferred two-wheelers by women as they are easy to operate and offer good fuel efficiency.
The future demand for two-wheeler lubricants will be driven by various factors, including growing commercial use, increasing female riders, and penetration of two-wheelers in rural markets in developing countries. However, there will be some obstacles for market growth. The restriction of two-wheeler movement in cities due to congestion and substitution of conventional two-wheelers with electric two-wheelers (bicycles, mopeds, and motorcycles) are the long-term challenges that the lubricants industry is facing.