India CV sales in June remain a mixed bag for OEMs

While the overall CV sector is expected to post nearly 10-12% growth in FY2016-17, rising diesel prices and increased truck rentals remain a concern for the short-term.

By Kiran Bajad

01 Jul 2016

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India CV sales in June remain a mixed bag for OEMs

Commercial vehicle sales in June 2016 remain a mixed bag for OEMs. Of the companies which revealed their domestic sales numbers today,

Ashok Leyland, the second largest player in India, has recorded single-digit growth in the month. Mahindra & Mahindra registered growth across segments, its HCVs posting strong 29 percent albeit on a lower base. The company’s small CVs, where it typically gets larger volumes, grew in single digits. VE Commercial Vehicles continued with its double-digit growth thanks to introducing new M&HCVs.

While the overall CV sector is expected to post nearly 10-12% growth in FY2016-17, rising diesel prices and increased truck rentals remain a concern for the short-term. The market is still being driven largely by replacement demand, as also the government’s focus on infrastructure by clearing large road construction projects which has stimulated demand in heavy tippers. An increase in heavy goods transportation has also helped generate demand for heavy duty trucks and with the monsoon underway, expect an uptick in rural India in the coming months for small CVs.

Tata Motors’ total sales of 26,164 units last month were up 2%, (June 2015: 25,542 units). Its M&HCV sales were down 11% at 10,147 units (June 2015: 11,450) but its LCV sales rose 14% year on year, selling 16,017 units (June 2015: 14,092).

Ashok Leyland’s overall sales were up 7% YoY with total sales of 11,108 units in June 2016 (June 2015: 10,429 units). Its M&HCVs posted 8% growth at 8,685 units (June 2015: 8,016 units). LCV sales were flat at 2,423 units (June 2015: 2,413 units).

Mahindra & Mahindra’s M&HCVs recorded double-digit growth of 28%, selling 517 units last month (June 2015: 404 units). While the below-3.5T GVW products saw 4% growth with sales of 11,955 units (June 2015: 11,507 units), those in the above-3.5T GVW segment posted strong 29% year-on-year growth with sales of 1,068 units (June 2015: 826 units).

VE Commercial Vehicles maintained its strong double-digit growth with 20.3% with sales of 4,256 units in the domestic market (June 2015: 3,537 units).