India M&HCV sales stay firmly glued to growth road
Continuing their positive momentum, the commercial vehicle segment in India has sustained its strong growth in February 2016. The medium and heavy commercial vehicle (M&HCV) segment has maintained its strong double-digit growth curve over the past one-and-a-half year.
In the latest Union Budget, the government’s impetus on stepping up spending on infrastructure, especially the national highway building programs, will further fuel growth in the CV segment, especially M&HCVs which will be major beneficiaries of the infrastructure spend. The infrastructure sector has seen a total Budget allotment of Rs 218,000 crore including Rs 97,000 crore to accelerate expansion of highways and rural roads.
Talking about CV growth prospects, R Ramakrishnan, senior vice-president, Commercial Vehicles, Product Strategy and Planning and Customer Value Creation, Tata Motors, said, “Things are improving for the commercial vehicle segment, though it is a slow recovery. M&HCVs continue to show good growth and it will probably remain that way. The emphasis on the mining and opening up of the infrastructure sector are all positives for the M&HCV sector. I think it will continue to show growth, although not in the same percentage because the base is increasing compared to last year but it will be heavy growth for M&HCVs.”
As regards LCVs, he said the sector thus far has been negative and has shown growth only for the last couple of months. While growth is slated to come soon to LCVs, it will not be sudden or as large as for M&HCVs. Financiers are still cautious. “I think LCVs will take some time before they start recovering on larger volume or percentage growth. But they are definitely on the positive track and after another few months we will able to say confidently that the bottom is behind us. Right now, I will be a little guarded on LCVs,” said Ramakrishnan.
CV MAJORS NOTCH HANDSOME GAINS
With the major CV players revealing their February sales numbers, it is clear that M&HCVs are fueling their growth.
Tata Motors has registered total sales of 30,570 units in February 2016, which is up 15% (February 2015: 26,547 units). While it sold 14,872 M&HCVs, up 22% (February 2015: 12,190), it also sold 15,698 LCVs which marks a growth of 9.3% (February 2015: 14,357).
Ashok Leyland has put up a sterling show. Its overall sales in February 2016 were up 25% at 13,403 units (February 2015: 10,762). Its M&HCV numbers have risen 31% with sales of 10,798 units (February 2015: 8,230) while LCVs have gained marginally, up 3%, with sales of 2,605 units (February 2015: 2,532 units).
Mahindra Trucks & Buses’ M&HCV sales have risen 47% last month, the company selling 479 units (February 2015: 326 units). In the below 3.5-tonne GVW segment it has notched 15% growth with sales of 12,919 units (February 2015: 11,214 units). The above 3.5T GVW segment registered 15% growth with sales of 466 units (February 2015: 405 units).
VE Commercial Vehicles sold 53.7% growth selling 4,264 units in the domestic market, (February 2015: 2,774 units).