Hero MotoCorp Faces Entry-Level Reset as Low-Speed Electric Scooters Hit 18.68 Lakh Units

The Bike India Forgot to Count Is Reshaping the Entry-Level Market

A new note from Elara Capital argues that the prolonged weakness in entry-level motorcycle sales is not a cyclical dip but a structural reset, and the culprit is a category most of the industry barely tracks: unregistered, low-speed electric two-wheelers.

According to the brokerage's compilation of industry data, low-speed electric two-wheeler volumes exploded from 1.24 lakh units in FY23 to 18.68 lakh units in FY26, a compound annual growth rate of 147 percent. Their share of total electric two-wheeler sales jumped from 14 percent to 56 percent in the same period, overtaking registered high-speed electric scooters, whose share fell from 86 percent to 44 percent.

Because these low-speed machines need no registration and no insurance, they barely show up in official sales data. Count them, and India's electric two-wheeler penetration in FY26 was actually 13.9 percent, more than double the reported 6.6 percent. Total two-wheeler volumes for the year work out to roughly 2.40 crore units against the officially reported 2.21 crore.

The demand driver is economic. Priced between Rs 30,000 and Rs 50,000 and hugely popular with gig workers, these scooters undercut even a Hero Splendor on running costs. Meanwhile, domestic economy motorcycle volumes were almost flat at 19.24 lakh units in FY26, up just 0.5 percent year-on-year. Elara estimates that if low-speed electrics substitute for nearly half of economy motorcycle buyers, the combined affordable-mobility pool actually grew 24.2 percent, meaning demand did not vanish, it switched formats.

That is an uncomfortable read for Hero MotoCorp, whose franchise is built on exactly this entry-level space, and Elara has flagged the volume-migration risk explicitly. The brokerage says the key watch items are Hero's entry-level mix, rural adoption of low-speed EVs, and whether Hero chooses to compete in a pool currently dominated by unbranded players.

Festive data adds colour: Hero logged 1.69 lakh registrations during this year's Ganpati season with its two-wheeler share rising to 24.2 percent, while TVS grew faster still. More two-wheeler analysis on AUTOINDIA, and you can compare commuter models on our Compare page.

What this means for you: if you are a budget commuter, the real choice in 2026 is no longer just which 100cc bike to buy, but whether you need a registered motorcycle at all. For a 25km-a-day city run, a low-speed electric scooter can pay for its price gap in months, though service networks and battery warranty remain the weak points to check before committing.

(Sources: Elara Capital sector note via ETAuto, September 28, 2026; Zee Business Ganpati-season registration data. Image credit: Hero Splendor XTEC via Wikimedia Commons, CC BY-SA 4.0)