Indian Commercial Vehicle Manufacturers Expect Sales Recovery In Second Half Of 2024

India's leading CV OEMs anticipate a sales recovery in H2 2024 due to better freight transportation, the beginning of construction and mining activity, and higher infrastructure spending.

Key Highlights

• The top Indian CV OEMs predict a rebound in sales in H2 2024 as a result of improved freight transport, increased infrastructure investment, and others.
• Industry estimates indicate that October got off to a good start with sales up 31% sequentially to 1,00,000 units and 6% higher than the prior year.
• VECV expects the demand for heavy-duty trucks will be further supported by the expected recovery in mining and construction in the second half.

With the end of the monsoon season, improved freight movement, the start of construction and mining activities, and increased government spending on infrastructure projects, India's top commercial vehicle (CV) manufacturers, Tata Motors, Ashok Leyland, and VE Commercial Vehicles, expect a recovery in sales in the second half of the current fiscal year.

Every quarter, wholesale data on commercial vehicles are released by the Society of Indian Automobile Manufacturers (SIAM). According to industry estimates, October started on a positive note with sales up 31% sequentially to 1,00,000 units and 6% sales growth from the previous year. 

Related Link: Brand Wise Commercial Vehicle Retail Sales In November 2024: Mahindra Gains Market Share

Commercial Vehicle Sales Analysis In 2024

Due to weak infrastructure development, fewer mining operations, and excessive rains that affected cargo transportation, CV retails were down 11% in the most recent quarter and 0.65% in the first half of the fiscal year.

The October retail sales of CVs were bolstered by a surge in consumer sentiment throughout the festive season. Sales reached their highest monthly level in over five years. According to Federation of Automobile Dealers Associations (FADA) figures, CV sales last reached a peak of 126,133 units in March 2020. However, because customers had made advance orders to take advantage of lower pricing before the switch to Bharat Stage VI emission standards, sales were skewed at the time.

Sales Expectations By VECV In H2 2024

Vinod Aggarwal, Managing Director, VE Commercial Vehicles (VECV), said, “The government's renewed focus on capital expenditure and infrastructure development will drive demand for commercial vehicles. The anticipated recovery in mining and construction in the second half, compared to modest growth of about 5% that these sectors had seen in the first half, will further support the demand for heavy-duty trucks.” 

“Moreover, expected GDP growth, favourable monsoon and potential interest rate cuts will create a conducive environment for commercial vehicle sales. We should see a recovery in the second half.”

Sales Expectations By Tata Motors In H2 2024

Expecting the gradual increase in infrastructure spending to boost consumption and drive demand, Girish Wagh, Executive Director, Tata Motors, “As far as the festive season is concerned, we did see good improvement in the utilisation of trucks due to increased consumption. At the same time, October was the first month after the rainy season.” 

He added, “So we have also seen tipper utilisation (in construction and mining) going up, indicating that infrastructure projects have started doing well. This, along with improved buyer sentiment, stable diesel prices and overall economic growth are expected to support fleet expansion and replacement in the coming months.”

Bottomline

For FY25, Nirmala Sitharaman, the Union Finance Minister, increased capital funding for infrastructure development to a record 11.11 lakh crore. As government funds improve, industry stakeholders anticipate that the emphasis on capital investment, particularly in growth-related programs, will continue. To boost truck sales in the country, India is expected to invest Rs 143 lakh crore in infrastructure over the next seven fiscal years, ending in 2030.

Read More

GreenLine Mobility Partners With Flipkart For Sustainable E-Commerce Logistics

What Is Truck Leasing And How To Lease A Truck In India? Here’s Your Answer