The commercial vehicle industry this financial year is all set to break the sales volume recorded of 1 million seen back in FY19 powered by the goods and services tax rate cut and the general uptick in government spending on infrastructure.
Manufacturers of trucks and buses such as market leader Tata Motor have revised the growth estimate for the CV segment for FY26 to ‘high single digit’ from ‘mid-single digit’ projected at the start of year.
Girish Wagh, managing director and CEO, Tata Motors said, “We believe that there will be a better growth in H2(FY26) on a year on year basis compared to H1(FY26). Growth will be across the segments. Tata Motors and the industry should close with high single digit growth.”
FY19 saw sales of little over 1 million CVs. Since then, the industry has struggled to go past that total. FY24 had the best year after that with sales of 0.96 million units. During FY25, the industry clocked volumes of 0.95 million units, a 1% drop year-on-year.
“In terms of revenue the industry crossed the FY19 peak two years ago. I would certainly like to believe that the volume does cross the milestone of 1 million this year,” Wagh added.
Besides the incremental demand, the Indian CV market will benefit from the replacement segment as well from the GST cut. The average age of the medium and heavy-duty fleet in India is about 10 years and historically it has never been more than 7-8 years. The potential opportunity for the industry is to replace 1.1-1.2 million medium and heavy (MHCV) trucks.
Tata Motors incurred a capital expenditure (capex) of 3% of revenues in the first half. The second half will see a higher capex being incurred, a company official said.
Tata Motors is one of several bidders for the 10,900 electric bus supply tender floated by state-controlled Convergence Energy Services (CESL). The bid closes on November 14.
On the corporate average fuel efficiency (CAFÉ) norms, which will be implemented in April 2027, the industry has been able to arrive at a consensus across vehicle segments.
In the MHCV segment, the industry body Society of Indian Automobile Manufacturers has recommended to Bureau of Energy Efficiency and Ministry of Road Transport and Highways that instead of opting for constant speed fuel consumption norms and reduction as per that criteria, it should go for Bharat Vecto.
“Bharat Vecto is that vehicle energy consumption tool which is a real-life representation of what kind of fuel is getting consumed and what CO2 is getting emitted and this is the proposal that has been given to the government agencies and we are sure that it will be looked upon favourably,” Wagh added.
“For the light commercial vehicle segment a request was made for exempting for the N1 category from the CAFÉ norms since the the fuel consumption in this segment as a percentage of total fuel consumption in the country is less than 2% and the CO2 emission as a percentage is less than 1%,” Wagh added.
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