The COVID-19 pandemic has affected nearly each different phase within the Indian auto trade, and the business automobile sector isn’t any exception. In truth, it was one of many extra badly affected sectors within the auto sector, nonetheless, with the gradual reopening of economies, the CV trade additionally started to recuperate. The pandemic offered an excellent alternative for enlargement into Tier 2 cities and Tier 3 cities, particularly for the Intermediate and Light Commercial Vehicle (I & LCV) segments, with earlier solely metro cities being their large quantity drivers.
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In the primary quarter of the present monetary 12 months 2021-22, which ended on June 30, 2021, the business automobile trade’s collective gross sales stood at 1,05,800 models. Compared to 31,636 autos bought throughout the corresponding April-June interval in 2020, the phase grew greater than thrice. The medium and heavy business automobile (M&HCV) house grew greater than six occasions year-on-year to 29,158 models, whereas the LCV phase witnessed almost three-fold progress at 76,642 models. Tata Motors continued to steer the charts with gross sales of 42,825 models in Q1FY2022, carefully adopted by 34,034 models for a similar interval. Ashok Leyland secured the third place with 16,550 business autos bought between April and June 2021.
The pandemic offered an excellent alternative for enlargement into Tier 2 cities and Tier 3 cities, particularly for the Intermediate and Light Commercial Vehicle (I&LCV) segments
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Having stated that, we’ve to think about the truth that the state of affairs was not splendid in each the circumstances, and much more so in 2020 when the complete nation was beneath lockdown and each manufacturing and retail gross sales had been severely affected. On the opposite hand, the trade, particularly the cargo phase, was not hit as severely as a 12 months in the past, regardless of the challenges posed by the second wave of the coronavirus pandemic. And that is primarily as a result of markets had been partially operational, and lockdowns and restrictions had been imposed in choose locations.
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Though the state of affairs is bettering, trade consultants really feel that actual progress continues to be distant. Commenting on the efficiency of the CV sector in Q1FY22, Rajesh Menon, Director General, SIAM had stated, “Sales of 1.06 lakh units for the commercial vehicle segment was the lowest in the last 12 years, except for the first quarter of FY 20-21. ” On the opposite hand, Ravi Bhatia President and Director JATO India instructed carandbike, “Some of the CV recovery that we see is due to the gradual opening up of the economy. The real growth will come when the economic growth is strong.” He additional stated that home gross sales within the CV trade, or in any other case, “still haven’t reached pre-COVID levels, and I don’t think it will happen anytime soon. So that needs to happen earlier. Growth is still there.” is way “
Industry consultants say actual progress will occur solely when financial progress is powerful
At the identical time, Jalaj Gupta, Business Head, Commercial Vehicles, Mahindra & Mahindra Ltd. stated, “According to industry experts and insiders, it will take another financial year to regain or achieve F19 volumes. We are looking into the situation.” and calibrate in line with the bottom actuality. Everything is determined by the easing of the COVID-19 state of affairs and favorable coverage measures. As talked about earlier, a slowdown within the brief time period and a bounce again in the long term.”
The gross sales efficiency of the CV trade throughout FY2021 offers us a extra practical view of the present market state of affairs. Between April 2020 and March 2021, the collective gross sales from the business automobile trade stood at 568,559 models, which is about 21 per cent decrease than 717,593 models bought throughout the identical interval in FY20. The passenger business automobile (CV) phase has suffered heavy losses throughout this era, particularly the passenger gentle business automobile (LCV) house, which has fallen by almost 74 per cent. In truth, Mahindra’s Jalaj Gupta says, “The passenger CVs (buses and mini-buses) will take a really very long time to recuperate, and FY22, in all chance, might be a washout for this sub-segment. “
Passenger Commercial Vehicle (CV) phase has been badly hit particularly throughout the pandemic
The challenge of provide chain has additionally been a matter of concern including to the woes of CV producers. Almost each Original Equipment Manufacturer (OEM) is grappling with semiconductor shortages, which have affected the complete automotive trade globally. This sudden slowdown attributable to pandemic state of affairs cum lockdown restrictions and financial slowdown introduced the whole trade quantity all the way down to nearly 60 per cent in contrast to some years again.
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However, as we talked about earlier, the trade is now on a restoration path, and a number of other CV classes are exhibiting progress. Both ILCV and MHCV segments are on a restoration path, owing to rising demand from fruits, agriculture, greens, e-commerce and different consumption sectors pushed by doorstep supply of important commodities. Increased funding in infrastructure initiatives from the federal government sector can also be anticipated to spice up demand going ahead. Industry gamers consider that the CV trade is predicted to bounce again with a progress of not less than 15 per cent in FY22, pushed by business autos within the vaccine supply, gas burdener/tanker, container and chilly chain segments. pushed by further demand.
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With inputs from NDTV
