Truck market leader Tata Motors
dispatched 26,218 units during the month—5 per cent lower year-on-year. The overall volumes at the Mumbai based firm were dragged down by the Medium and Heavy Commercial Vehicles (M&HCVs) which declined 6 per cent year-on-year even as it rose 13 per cent compared to October, indicating a turnaround in demand for heavy duty trucks. These vehicles have their fate closely linked to the overall economic activities. The fall in M&HCVs were made up by the ICVs which grew 11 per cent year-on-year.
India's economy recovered faster than expected in the September quarter as a pick-up in manufacturing helped GDP clock a lower contraction of 7.5 per cent and held out hopes for further improvement on better consumer demand.
Total dispatches at Ashok Leyland
grew 4 per cent y-o-y to 9727 units. It was led by a brisk 23 per cent increase in M&HCVs (trucks) and a 31 per cent jump in light commercial vehicles sales.
Mahindra and Mahindra showed a similar trend. Its overall dispatches during the month increased 17 per cent year-on-year to 19029 units, the company said. It was also led by an increase in demand for LCVs less than 2 tonnes and the vehicles between 2 to 3.5 tonnes. They advanced 19 per cent and 9 per cent respectively. Meanwhile, selling higher tonnage vehicles—those above 3.5 tonnes remained a challenge for M&M.
In line with the broader trend, Volvo Eicher Commercial Vehicles (VECV) saw its overall dispatches increase 4.4 percent y-o-y to 3237 units.
CV wholesales missed estimates due to lower LCV volumes while M&HCV volumes reflected good recovery, with volume decline restricted to 9.6 per cent y-o-y. LCV volumes grew just 2 per cent y-o-y, Jinesh Gandhi, analyst at Motilal Oswal wrote in a research report. “Tata Motors
CV volumes decline was below estimates. On the contrary, VECV was in line with estimates,” wrote Gandhi.
Commercial vehicles (CV) volumes are expected to shrink 25-28 per cent this fiscal amid multiple headwinds along with the pandemic impact, and the outlook for the sector remains "negative" on the back of continuing challenges, ratings agency ICRA said last month.