EconomyFinancialMexicans see motorcycles as an alternative to rising car...

Mexicans see motorcycles as an alternative to rising car prices

Has it crossed your mind to buy a motorcycle instead of a car? You are not the only one. The skyrocketing price of cars, both new and used, is driving motorcycle purchases around the world. While the prices of the most basic cars already exceed 200,000 pesos in Mexico, the smallest motorcycles – 200 cubic centimeters – can be had for 70,000 pesos, or even a little less.

Before the pandemic, the global motorcycle market had maintained marginal annual growth of 1.5% since 2012, MotorCycles Data. But in the post-Covid era, the motorcycle industry is set for a booming decade due to growing global demand for individual mobility and the impact of electrification and chip shortages on vehicle prices.

“Motorcycles become an ideal vehicle at a time when problems in the supply of automobiles have raised prices significantly,” says Juan Pablo Martín del Campo, president and CEO of Triumph Motorcycles de México, in an interview.

In the country there is a portion of consumers who are satisfying their need for affordable mobility with a motorcycle or scooter . Before the pandemic, only 2.2% of the population in Mexico had a motorcycle and now it is around 10%. “We think that this will continue to grow significantly,” says Martín del Campo.

The advantages of using a motorcycle

Beyond price, motorcycles offer other advantages that are attractive to consumers at a time when many are in a dilemma about how to redistribute spending to get money for taxes, rent, mortgages and tuition.

The first one pointed out by the Triumph manager is fuel savings. A typical motorcycle offers an average performance of 20 kilometers per liter of gasoline, while an average car offers a consumption of around 10 kilometers per liter. In addition, the cost of maintenance and taxes are also lower. Unlike cars, which must be checked, motorcycles do not have to step on checkpoints.

Although motorcycles and scooters have limited passenger carrying capacity, they are easy to park and save several minutes of traffic in big cities. “You can save between three and four hours a week in travel times,” says Martín del Campo, citing a study conducted by the Tecnológico de Monterrey.

work motorcycles

The demand for home deliveries has driven the purchase of bicycles and motorcycles around the world, and Mexico is no exception. “People turned to motorcycles to be able to have additional income from all these delivery systems,” says Martín del Campo.

Manufacturers that were not involved in the work motorcycle segment are now looking to enter it. Triumph , for example, will launch a range of low-displacement models, from 200 to 400 cubic centimeters, at the end of 2023, with which it hopes to get a slice of this market.

These models will have a price range of between 90,000 pesos and 130,000 pesos, and the brand will offer financing plans, hand in hand with Santander, of up to 60 months, with down payments from 10%. “This will make motorcycles very accessible,” says Martín del Campo.

The boom of electric scooters

In the post covid era, electrification has become more relevant. The growth of a group of consumers seeking new mobility options, in addition to the tightening of emission limits for two-wheeled vehicles in some cities – the European Commission aims that by 2035 no more combustion vehicles will be sold in the region–, have prompted motorcycle manufacturers to speed up the electrification of their range.

Honda , which dominates the global motorcycle business, announced in mid-September that it plans to launch more than 10 electric motorcycle models globally in the next three years, as part of its goals to achieve carbon neutrality for motorcycles in the world. the 2040s.

BMW, which is also preparing for a near future in which only electric vehicles can be sold, has decided to speed up the electrification of its motorcycle division, BMW Motorrad. In the middle of the year It is the CE 04 model, which with a range of up to 130 kilometers per charge and a price of 344,600 pesos, seeks to earn a place in the urban segment.

Even automakers that weren’t in the segment are looking for a slice of the electric scooter market. Seat, the brand owned by the Volkswagen group that targets a segment of young consumers, launched a new business division called Seat Mó, under which it will market electric scooters and scooters.

It recently presented the , with a range of up to 125 kilometers per charge, in the Mexican market. The vehicle will reach the 40 dealers of the brand under a scheme of direct sale to the consumer with an estimated price of 145,000 pesos.

Triumph recently finished a first prototype of an electric motorcycle, which could hit the global market after 2024.

Motorcycle manufacturers, however, face challenges when switching to electric, as the move to electric can mean heavier vehicles and higher prices, raising barriers to entry for developing market consumers.

Even so, the prices of electric motorcycles are more accessible than those of electric vehicles, whose prices exceed 500,000 pesos and reach up to 3.5 million pesos in Mexico. In contrast, an electric motorcycle costs less than 200,000 pesos and can be purchased in monthly installments of 3,000 pesos or less.

Motorcycle manufacturers posted 2021 global sales of 58.6 million motorcycles in 2021, which while still below the record set in 2018, represents an 8.5% recovery from 2020, according to data from MotorCycles Data.