Comments
With positive growth in volumes for two consecutive months, recovery hopes got stronger for the medium and heavy truck segment.
After a sluggish first quarter, goods category of the medium and heavy commercial (M&HCV) segment witnessed a positive growth in July and August, with prominent players recording double digit increase in volumes.
In July, M&HCV goods segment reported 14 per cent increase at 19,703 units. In August too, top players such as Tata Motors, Ashok Leyland and VE Commercial Vehicles (VEVC) reported double-digit growth in volumes.
Thethree companies reported 52 per cent, 29 per cent and more than 10 per cent growth in overall M&HCV volumes respectively during the month.
There has been an increase in demand across categories within M&HCV and it is expected to grow further.
A combination of factors helped the industry — stricter regulatory norms on overloading, increasing acceptance of BS IV technology and growth in infrastructure, mining and construction sectors.
“Commercial Vehicles segment is a very dynamic segment and has always witnessed a changing trend month on month. Having said this, the ongoing regulatory changes like the GST, stringent norms on overloading and growth in construction, mining and infrastructure have given a further push to the growth of M&HCV segment,” a spokesperson of Tata Motors said.
Subrata Ray, Senior Group Vice President of Icra, attributes the pent-up demand post implementation of GST and low base effect (truck sales had declined sharply in Q2 FY 2017), among others for volume growth.
Industry representatives and analysts expect truck sales to remain strong in the coming months due to replacement sales, stronger demand for tippers (owing to pick-up in construction and mining activity) and stringent norms being followed in many States now with regards to overloading.
But, Vinod Aggarwal, Managing Director and CEO, VE Commercial Vehicles, is cautiously optimistic about the growth trend.
“We will get a clearer picture after experiencing the demand during the festival season. Sales in Q2 of last fiscal were very low. We will wait and see how the trend continues. This month is a crucial month,” he said.
He said the effects of disruptions such as demonetisation, BS-IV norm change and GST were behind and the industry would look forward to the growth curve.
During the first quarter of this fiscal, M&HCV goods vehicles sales declined by 33 per cent to 39,872 units.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.