New Delhi: Hit by last year's high base and weakness in demand, the domestic commercial vehicle industry is expected to see a 4-7 per cent decline in wholesale sales in the current financial year compared to FY23, rating agency ICRA said. Friday.
Medium and heavy commercial vehicle (truck) volumes are expected to decline by 4-7 per cent year-on-year given the high base effect and impact of Lok Sabha elections on infrastructure activities in the first few months.
Similarly, wholesale sales of light commercial vehicles (trucks) are likely to decline by 5-8 per cent in FY2025 due to factors such as high base effect, continued slowdown in e-commerce and increasing adoption of electric three-wheelers. Iqra said.
The rating agency expects the domestic CV industry boom to stall in FY2025 with a 4-7 per cent decline in wholesale sales.
It said that wholesale and retail sales have seen a slow growth of 1 percent and 3 percent respectively year-on-year in FY 2024.
“FY22 and FY23 witnessed very strong growth in terms of volumes as well as tonnage, boosting the base. The pace of domestic CV volume growth slowed in FY2024 and economic activity in some sectors witnessed a transient The decline is expected in FY25 amid the general elections,” said Kinjal Shah, senior vice president and co-group head, Icra Ratings.
He said replacement demand will nevertheless remain healthy (primarily due to the aging fleet) and is expected to support CV volumes in the near-to-medium term.
Shah said the long-term growth drivers for the domestic CV industry remain intact, such as continued growth in infrastructure development, steady growth in mining activities and improving roads/highway connectivity.
Medium and heavy commercial vehicle (truck) volumes are expected to decline by 4-7 per cent year-on-year given the high base effect and impact of Lok Sabha elections on infrastructure activities in the first few months.
Similarly, wholesale sales of light commercial vehicles (trucks) are likely to decline by 5-8 per cent in FY2025 due to factors such as high base effect, continued slowdown in e-commerce and increasing adoption of electric three-wheelers. Iqra said.
The rating agency expects the domestic CV industry boom to stall in FY2025 with a 4-7 per cent decline in wholesale sales.
It said that wholesale and retail sales have seen a slow growth of 1 percent and 3 percent respectively year-on-year in FY 2024.
“FY22 and FY23 witnessed very strong growth in terms of volumes as well as tonnage, boosting the base. The pace of domestic CV volume growth slowed in FY2024 and economic activity in some sectors witnessed a transient The decline is expected in FY25 amid the general elections,” said Kinjal Shah, senior vice president and co-group head, Icra Ratings.
He said replacement demand will nevertheless remain healthy (primarily due to the aging fleet) and is expected to support CV volumes in the near-to-medium term.
Shah said the long-term growth drivers for the domestic CV industry remain intact, such as continued growth in infrastructure development, steady growth in mining activities and improving roads/highway connectivity.
