Unveiling India’s MBO 2 Wheeler Boom: Discover the Driving Forces Here!


Are you excited to witness the exhilarating transformation of India’s two-wheeler market? With rapid diversification and digitalization at the forefront, a new era of possibilities awaits. From cutting-edge technology to innovative designs, this revolution is set to redefine mobility like never before. Here we unravel the driving factors behind this remarkable shift and explore the untapped potential. Don’t miss out on being a part of this groundbreaking journey- discover the reasons behind India’s 2W MBO boom now!

1. Indian 2W Market has multiple MBOs that either source their inventory from an authorized dealer by purchasing 2Ws or selling 2Ws on behalf of authorized dealers by keeping certain commission

OEMs are selling 2Ws from the MBOs such as…


MBO market is highly fragmented with ~6,000 MBOs Pan India.
Few MBOs are mentioned below…


Two Models followed by MBOs


Key Driver MBO sales

First-time buyers

Slow recovery and improving demand after COVID

Challenges MBO sales


Authorized dealer control

RTO restrictions

Future of the MBO Market

  • MBOs wants to directly connect with the OEM
  • MBO 2W market will grow majorly via ICE sales
  • EV segment is not expected to bring a significant change in near future
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2. In India, MBOs are now being looked at as the next emerging megatrend especially in the EV segment

    End User Associated Growth Drivers
  • Servicing of any brand at one place is preferred by end users
  • Instant delivery (Reseller Model)
  • Better awareness about the customer choices and preferences.
  • Only maintain inventory for hot sellers
    Supplier Associated Growth Drivers
  • Support and Guidance from the Authorized dealers and sub dealers
  • Complete control over brand choices. (Reseller model)
    Industry Associated Growth Drivers
  • Introduction of EV products in the existing MBO portfolio
  • Industry knowledge from the existing market scenario
  • Low impact by the sales drop of a particular brand
    Government Associated Growth Drivers
  • Government is offering increased incentives to maximize the sales of EV in India.
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3. 2W MBO market in India witnessed a huge no. of players entering the market after the 2000s, along with the entry of multiple foreign brands


  • In the 1950s API, and Royal Enfield were the sole producers of 2W in India.
  • In 1958, Bajaj Auto was the first two-wheeler brand to import Vespa scooters in India.
  • TVS Suzuki was the first foreign brand to enter the 2W market in mid 80s.
  • Due to stringent government regulations historically, foreign 2W brands in India could not set up its operation base.


  • Later the government guidelines were relaxed and many OEM established their base in India.
  • Concept of MBO in the Automotive field was initiated to penetrate in the sub-urban and rural areas.
  • Many 2W MBOs such as Alka Auto, Jolly Auto, Geeta Motors, AV Bike, Pro Bikez, Hariom Auto and more entered the Indian Market.
  • During COVID, the overall bike sales was affected which also affected the sales via MBO.


  • MBO market in India is expected to rise owing to the improved connectivity to the rural areas.
  • The improvement in the paying capacity of the both middle class and lower middle class will also become one of the major factor to increase the sales volume of 2W in future.
  • Another major driver is the sales of 2W EV in the Indian Market is expected to rise in the coming years and it will have significant contribution in the overall 2W sales. The E2W market in India has seen substantial growth, India has seen >150% increase in sales in the recent years.1


  • During this phase, the MBO awareness was very low. Due to which the sales via an MBO were also affected.
  • Customers were quality conscious especially about the reliability of the product.


  • Currently, the major driving factor is the advantage of becoming a one stop solution to compare different models and prices.

III: Late Growth Stage Post 2026- 2050

  • EV is gradually becoming a new popular choice as buying a vehicle may be expensive but the maintenance cost is low. High penetration from the demand side and push from the government will help E2W have significant share in the total 2W sales in future.
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4. However, MBO industry has been witnessing several headwinds in the recent past, including subdued demand for 2Ws concurrently affecting the MBO sales

Challenges and Issues

Control of Insurance and Authorized dealers

  • Insurance and Vehicle providers (authorized dealers) would like to see multi brand players surviving so that they have more negotiation powers.

Accessory and Other spare parts availability

  • It takes much longer time for a multi brand service provider than the time taken by an authorized garage who has the electronic manual with prices and the physical parts readily available.

No Quick informal decision making

  • Quick informal decision making for which owner is not bound to answerable to anyone except that he either goes on with his business or goes out of business. (Reseller model)

Supply Chain Efficiency and RTO restrictions

  • Success of an MBO player will depend upon the supply chain efficiency for the 2W to provide seamless service.
  • In some geography RTO restrictions are more strict, due to which a sub dealer cannot keep the display vehicles.

Lack of Trained manpower

  • Multiple brands have different bugs in their 2Ws which affects the post sale service if the workshop workers are not trained or experienced.

Low profits of Pop and MOM Stores

  • The pop and mom stores are not making super profits due to the lack of connectivity with different 2W OEM Authorized dealers.
Source: Interviews conducted with MBO dealers, Finance partners, OEM dealers, Industry Articles and Ken Research Analysis

5. But, Diversification, Digitalization, and Expansion will help the industry to proliferate in the country in the coming years

    Key Trends and Developments Significance
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