Frost & Sullivan’s analysis, Forecast of the Indian Commercial Vehicles (CV) Market projects CV sales volumes to incraese from 0.6 million in FY 2014 to 0.9 million in FY 2020. LCV sales would grow at CAGR of 6.1% over the forecast period owing to urbanization,a key MegaTrend that impacts LCV sales positively. MCV and HCV sales will expand at a CAGR of 7% owing to manufacturing industry’s revival, and increased activity in infrastructure, industrial and mining sectors.
Rising per capita consumption, infrastructure, and Industry and Mining in India will keep contributing towards CV market growth as per a Frost & Sullivan Automotive & Transportation Industry Analyst. CV market would get a significant boost in the second half of FY 2015 and early on in FY 2016. Growth will present opportunities for CV manufacturers in this period.
Favourable attitude of Central Banks to support economies after the financial crisis of 2008-2009 is a positive trend in India. China’s slow growth is influencing lower commodity prices. Emergence of US as a major oil producer impacts crude oil prices negatively, which indirectly has a positive impact on CAD, and fiscal situation of India. The newly elected government is working to re-establish economic growth at a higher rate than in the last few years.
Withdrawal of Quantitative Easing by Central Banks, and longer gestation time for implementation of key reforms could pose as hindrances, and delay revival of Indian CV Market.
Total cost of ownership remains a crucial purchase criterion for an Indian buyer. Next gen LCV, MCV and HCV segments coudl favourably shape consumer preferences. As such Tata Ultra, VE CV Pro Series, Ashok Leyland Boss/Partner and U Series, and new players like BharatBenz will lead from the front in shaping success of the value truck segment.