Piaggio Group operates globally in two markets in the light mobility vehicle industry:
- two-wheeled vehicles (consisting of scooters and motorcycles);
- and commercial vehicles (both three- and four-wheeled light commercial vehicles).
Piaggio Group is the leading European manufacturer of two-wheeled vehicles and one of the leading producers of three-wheeled vehicles in India.
The macroeconomic framework
In 2016, the world economy grew by approximately 3%, with dynamics differing by geographic segment, against a background of reduced inflation in western countries and commodity prices, partly affected by oil prices, picking up at the end o f the period.
The two main economies in East Asia confirmed important growth trends. Growth was down slightly in China (+6.7%) against a backdrop of higher public spending and a consequent problem of keeping financial risk in check and a weakening national currency. In India, growth was steady (approximately 7%), driven by internal demand, although curbed by the demonetisation process launched by the Indian government on 8 November 2016, which reduced forecast growth by around one per cent.
Japan recorded slight improvements in growth (nearly 1%), thanks to its ongoing budget and expansive monetary policy.
Growth was consolidated in the United States (approximately 1.6%), paving the way for monetary policy normalisation. As a result, the dollar got stronger and this trend was confirmed following the prospect of reflation policies announced by the new administration.
Overall growth was consolidated in the eurozone (1.7%), in a context of marginal inflation, which led the ECB to confirm major monetary intervention programmes.
Growth in Italy was nearly equal to 1%. The slight improvement in consumer trends and employment confirmed the need for further structural reforms - to improve competitiveness, and for EU policies that not only focus on the strict control of government undertakings, but also on supporting investments.
The two-wheeler sector (scooters and motorcycles) at a global level, based on figures from monitored markets, recorded sales of over 46 million vehicles in 2016, with an overall increase of 0.6% compared to the previous year, but with different dynamics anchored to the geographic segment.
India, the most important two-wheeler market, continued its growth trend in 2016, ending the year with just over 17.7 million vehicles sold, up by 9.7% compared to 2015.
China instead recorded decreasing volumes in 2016, down by 12% compared to the previous year and ending the period with nearly 8 million units sold.
The Asian area, termed Asean 5, reported a slight increase in 2016 (+0.9% compared to 2015) ending the year with 12.3 million units sold. Indonesia, the main market in this area, continued its downturn in 2016, with total volumes of over 5.9 million units and a decrease of 8.5% compared to the previous year. Growth in Thailand picked up (1.7 million units sold; +6.4% compared to 2015); while Malaysia confirmed last year’s negative trend (373 thousand units sold; -1.9% compared to 2015). The sales trend in Vietnam remained buoyant in 2016 (3.1 million units sold; +9.5% compared to 2015). The Philippines recorded the strongest growth trend in the area, with first-time sales of over 1 million units (1.1 million units sold; +34.1% compared to 2015); Volumes of other Asian area countries (Singapore, Hong Kong, South Korea, Japan, Taiwan, New Zealand and Australia) increased, in overall terms, compared to the previous year, with 1.4 million units sold (+8.5%). Within this area, Japan was still affected by a downturn (380 thousand vehicles sold, -6.6% compared to 2015), while sales in Taiwan went up considerably, with 788 thousand units sold (+18% compared to 2015).
The North American market reported a decrease of 1.9% compared to 2015 (547,100 vehicles sold in 2016) reversing its positive trend of previous years.
Brazil, the leading market in South America, recorded a strong downturn (- 28%), with 858 thousand vehicles sold in 2016.
Europe, the reference area for Piaggio Group activities, confirmed its positive growth trend in 2016 as well, reporting an 8.7% increase in sales overall compared to 2015 (+15.2% for the motorcycle segment and +3.4% for scooters), ending the period with 1.3 million units sold.
The scooter market
The European scooter market in 2016 accounted for 696,500 registered vehicles, with sales up by 3.4% compared to 2015.
In 2016, vehicle registrations were higher in the over 50cc segment, with 429,000 units against 267,500 units in the 50cc scooter segment. The over 50cc scooter segment increased by 8.3% compared to 2015, while the 50cc segment fell by 3.6%.
Italy is still the most important market among leading countries, with 138,350 units sold, followed by France with 130,400 units and Spain with 115,000 units. Holland ranks fourth, for sales, (66,400 units) ahead of Germany, with 61,400 units sold. Lastly, Greece and the United Kingdom recorded sales of 38,650 and 36,100 vehicles respectively.
In 2016, the Italian market reported a positive growth trend compared to the previous year (6.8%).
The 50cc segment went down by 2.5%, with 20,500 units sold. In the over 50cc segment, 117,900 units were sold, registering an increase of 8.6% compared to 2015.
The French market with 130,400 vehicles decreased by 2.9% compared to the 134,300 vehicles sold the previous year: this decline was recorded in both the 50cc and over 50cc segments, with a decrease of 3.9% (72,900 units sold in 2016) and 1.7% (57,500 units sold) respectively.
Spain performed the best among leading markets, with a growth of +12.3% compared to 2015.
Both the over 50cc market (+13.2%) and the 50cc scooter segment (+ 6.7%) contributed to this result.
The German market registered a slight decrease (-0.2%) with approximately 61,400 vehicles sold in 2016 compared to 61,500 in 2015. On this market as well, the downturn was due to the 50cc scooter segment (-7.6%), while the over 50cc scooter segment reported an increase (+8%).
The United Kingdom recorded a strong growth trend (+11.8%), thanks to an increase in the over 50cc segment(+18.8%), while sales in the 50cc scooter segment fell (- 7.4%).
In 2016 the market still reported a downturn (-11.2%), with approximately 29,600 units sold: this negative trend is due to the over 50cc scooter segment, where sales fell by 14% and to the 50cc scooter segment, with sales going down by 8.9%.
The scooter market in the United States (which accounts for 89% of the reference area), declined by 12.5%, with 26,300 vehicles sold; a slight upturn was recorded instead on the Canadian market, with over 3,300 vehicles registered in 2016, accounting for an increase of 1.4%.
The main scooter market in the Asean 5 area is Indonesia, with just over 5.3 million items sold, reporting a decrease of approximately 7.8% compared to 2015. The Cub segment (vehicles with gears) accounted for the downturn, confirming the negative trend of previous years and closing with 599 thousand units and a decrease of -30.1%. The decrease in the automatic scooter segment Financial Statements 2016 29 was far more moderate (-3.9% compared to 2015 and nearly 4.7 million units sold).
The second main market is Vietnam, which reported a 9.5% increase and 3.1 million units sold, of which 1.7 million Cub scooters (+6% compared to 2015) and 1.4 million automatic scooters (+9.6% compared to 2014).
The Vietnamese market mainly concerns scooters, as sales in the motorcycle segment are not particularly significant. The 50cc scooter segment is not operative on this market. The 51-115cc subsegment was the most important, with over 960 thousand units sold (+8.6%).
The premium automatic scooters segment continued its growth trend in 2016 (+ 17.2%), with 293 thousand units sold.
The automatic scooter market increased by 15% in 2016, ending the year with over 5.6 million units sold.
The 125cc segment was the best performer, with more than 5.5 million units sold in 2016, accounting for 98% of the total automatic scooter market. With the new Aprilia SR 150 coming onto the market, the 150cc segment reported a growth trend of over 500%, closing the period with 16,300 units sold in 2016. The 50cc scooter segment is not operative in India.
The motorcycle market
With 621,200 units registered, the motorcycle market ended 2016 with a 15.2% increase. All subsegments reported a growth trend, including the 50cc subsegment (+11.8%) which closed with 34,800 units sold. Growth in the over 50cc segment was stronger, with sales of 586,400 accounting for an increase of 15.4%.
The main European market was Germany with 141,600 units, while France ranked second (120,300 units); the United Kingdom with 92,200 vehicles stayed in third place, ahead of Italy which ended the year with 78,800 units sold; Spain ranked fifth with 57,200 vehicles sold.
In 2016, all main countries in Europe reported positive trends compared to the previous year: the highest growth, in percentage terms, was recorded in Spain, (+25.7%), but performance was also extremely positive in Italy (+21.4%), Germany (+16.4%), France (+12.4%), and Great Britain (+11.8%).
Only Switzerland recorded a negative trend during 2016 (- 2.7%) closing the period with 26,300 units sold.
The motorcycle market in North America (USA and Canada) recorded a downturn of 1.3% in 2016, closing the period with 517,500 units compared to 524,300 the previous year. In the United States (accounting for 89% of the area), the motorcycle segment recorded a 2.1% decrease, selling 460,800 units compared to 470,600 units in 2015. The trend on the Canadian market was instead positive, ending the year with 56,600 units sold, up by 5.4% compared to the previous year.
India is the most important motorcycle market in Asia, selling over 11.2 million units in 2016, accounting for a 6.5% increase.
The motorcycle market in the Asean 5 area is far less important than the scooter sector. Sales of motorcycles in Vietnam were not significant. In other countries, the highest sales were recorded in Indonesia; however with 644 thousand units sold, this meant a decrease of 13.5% compared to the previous year.
In 2016, the European market for light commercial vehicles (vehicles with a maximum mass of up to 3.5 tons) where the Piaggio Group operates, accounted for 1.9 million units sold, up 11.9% compared to 2015 (source ACEA data). In detail, the trends of main European reference markets are as follows: Germany (+8.5%), France (+8.2%), Italy (+50.0%) and Spain (+11.2%).
Sales on the Indian three-wheeler market, where Piaggio Vehicles Private Limited, a subsidiary of Piaggio & C. S.p.A., operates, went up from 514,000 units in 2015 to 546,000 in 2016, registering a 6.2% increase.
Within this market, the passenger vehicles subsegment reported a positive trend (+4.8%), closing with 439,000 units. The cargo segment also reported an increase (+11.9%), from 95,000 units in 2015 to 107,000 units in 2016.
Through its Indian affiliate, the Piaggio Group also operates on the four-wheeler light commercial vehicles (LCV) market (cargo vehicles for goods transport). The LCV cargo market, with vehicles with a maximum mass below 2 tons and on which the Porter 600 and Porter 1000 are sold, accounted for 116,100 units sold in 2016, going up by 0.4% compared to 2015.
The demonetisation decided by the Indian government resulted in a considerable market downturn, from November 2016 onwards. Despite this, forecasts for next year are optimistic, pointing to a market increase in 2017.