Heavy-duty commercial vehicles are predicted to be sold in FY24, with a 30% increase in revenue
- IBEF
- November 22, 2023
A barometer of economic activity, commercial vehicle sales are predicted to reach a record high in FY24, fetching record revenue for companies like Tata Motors, Ashok Leyland, and VE Commercial Vehicles. Demand for heavier-duty trucks is being driven by higher prices due to greater freight movement and unprecedented government spending on infrastructure. Although sales in FY24 are predicted to increase by roughly 30% from FY19, the pre-Covid year's peak of 1,007,311 units may be slightly surpassed.
More rigorous emission regulations have made vehicles more expensive, and demand for trucks with larger payloads has increased. These factors have increased revenue per unit.
Better highways have increased the desire for road travel and overcrowded train travel, which has resulted in a more than 35% increase in demand for buses over this time.
“Sales of heavy-duty trucks that can carry more freight has grown in healthy double digits — by 15% in the first seven months of the year,” said Mr. Vinod Aggarwal, President of the Society of Indian Automobile Manufacturers (SIAM) and VE Commercial Vehicles (VECV) Chief Executive Officer and Managing Director.
An efficient industry official from a leading CV manufacturer stated that the commercial vehicles’ mix's tilt was beneficial.
The industry exported 604,975 trucks and buses by the end of October, compared to sales of 962,468 units for the entire FY23 and 592,686 units for the same period the previous year.
The leading truck manufacturers in the nation, Ashok Leyland, VECV, and Tata Motors, are optimistic that the momentum will continue.
Demand is anticipated to be supported by high infrastructure spending (Rs. 143 lakh crore (US$ 1.72 trillion) to 2030), replacement demand, and domestic economic development.
Medium- and heavy-duty commercial vehicle (MHCV) sales have increased at market leader Tata Motors as well, according to Executive Director Mr. Girish Wagh. Going forward, it anticipates that as the market adjusts to price hikes brought on by the switch to better emission standards and the simpler access to financing, demand for light commercial vehicles (LCVs) will also increase.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.
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