A top industry official said commercial vehicle (CV) sales, a barometer of economic activity, are recovering and are likely to hit an earlier peak in the coming financial year.
With business activity picking up, cargo movement has been on the increase. This, coupled with replacement orders from fleet operators, is required to support sales of CVs above 3.5 tonnes in the coming months.
“The Commercial Vehicle segment began seeing headwinds toward the end of 2019; then came the pandemic, Favourably, in the current financial year, the industry is witnessing a pretty confident and powerful rebound. At the rate we are hopping back, we can give peak volumes of about 500,000 units next year,” answered Kamal Bali, President at Volvo Group, India, said ET.
Around 126,000 Commercial Vehicles were sold in the local market in the first six months of the financial year, more than increasing from 50,000 links in the year-ago period. Industry estimates as many as 275,000-300,000 Commercial Vehicles in this category will be sold in the ongoing financial year.
“After the second Covid wave, the market is witnessing gradual recovery across most segments led by M&HCVs with increasing fleet utilization levels, a higher number of road construction projects awarded and improving cement consumption,” Girish Wagh, executive director - Tata Motors, said earlier this month.
Bali said that demand from the mining and construction sectors are already at levels seen before the outbreak of the coronavirus pandemic.
“We are very bullish about the growth possibilities arising from the infrastructure and logistics businesses in the country. With the government declaring the National Infrastructure Pipeline and Gati Shakti, on the market side we do not foresee difficulties in the next 10 years,” said Bali.
In April last year, a management task force firmed up a roadmap for capital investments of Rs 111 lakh crore in infrastructure under the NIP (National Infrastructure Pipeline) over six years through FY25, pledging 71% of the expenditure for energy, roads, urban construction and railways, and envisaging a pivotal role for private investors.
The Prime Minister subsequently announced the launch of the Gati Shakti infrastructure plan, which will build upon the NIP by creating “an integrated framework” for infrastructure development across the country, which will ensure that various economic hubs can better utilize the investments in the sector being done by the government and private players.
Separately, Bali said, governments worldwide increasingly are looking at reducing emissions. Increasing mobility while decarbonizing transport on the sidelines of the 8th India Sweden Innovation Day themed ‘Accelerating India Sweden’s Green Transition’ is required.
While there is potential to produce hydrogen fuel cell solutions for trucks operating lengthy distances in the CV segment, he said battery-electric options are more feasible on shorter routes.
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