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Amid uncertainty over the new axle load norms, the commercial vehicle industry maintained its sales momentum in August, helped by robust demand in core sectors.
The industry has reported a strong double-digit growth during August with leading players reporting higher volumes. The sales growth was supported by buoyant demand in road construction, irrigation projects and the increase in government spending on infrastructure projects.
Tata Motors’ domestic commercial vehicle (CV) sales grew by 26 per cent at 39,859 in August this year as against 31,566 units in August 2017. Its medium and heavy commercial vehicle (M&HCV) sales grew 16 per cent at 12,715 units, while The I&LCV segment reported a strong performance with 36 per cent growth at 5,260 units. Tata’s small commercial vehicle segment comprising mini and pickup trucks reported a 37 per cent at 17,426 units.
“Improvements in GDP growth and other industry indicators continue to support the year-on-year growth,” Girish Wagh, President, Commercial Vehicles Business Unit, Tata Motors was quoted explaining the growth.
Ashok Leyland’s M&HCV volumes (include both domestic and export) rose 24 per cent at 13,158 units in August, while its LCV volumes grew 38 per cent at 4,228 units.
VE Commercial Vehicles’ domestic truck and bus sales grew 27 per cent at 4,843 units (3,818).
“Despite uncertainty created from the revision in axle load norms, the commercial vehicle sales momentum has not faced a bump primarily because of healthy demand from construction sectors and delays in notification of revised axle load norms, said Shamsher Dewan, Vice-President & Sector Head - Corporate Ratings, Icra Ltd.
Some cheer
August had also brought back some cheer for the trucking industry on the freight rates front. After a 7 per cent drop in July, freight rates on trunk routes went up by 4-5 per cent. Fleet utilisation level was also higher.
The increase in truck rentals was mainly driven by a spike in diesel price by ₹1.30 per litre and improved cargo offerings from fruits, food items, general merchandise on the back of higher consumer spending, said SP Singh of Indian Foundation of Transport Research and Training.
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