Tata Motors sees recovery in small commercial vehicles after bottoming out

Tata Motors spoke of a turnaround in the small commercial vehicle (SCV) segment in a post-earnings call with analysts, even as the company held on to its market share in the trucks and intermediate commercial vehicle segment. 

"Green shoots are starting to emerge in the small commercial vehicle space as well, which is something that we said we will continue to work upon So it's going to take a few more quarters, but it's nice to see this now starting to turn. I think we seem to have bottomed out," said PB Balaji, group CFO of Tata Motors, during the call.

Girish Wagh, executive director, at Tata Motors, said, "SCV pickup, I think, seems to have bottomed out in Q3 and started the movement up. The transformation in (SCV) pickup is underway, and we should start seeing results as we go ahead."

The remarks from Tata Motor's top leadership should be seen in the context of a slight slowdown in demand for small commercial vehicles, which have seen volume contraction in the recent past, owing to the high base effect catching up, a continued slowdown in e-commerce demand, and some cannibalisation from electric three-wheelers (e3Ws). Further, rural demand and cash flows were impacted by the unseasonal rainfall, which  impacted demand, industry experts point out.