As India is reeling under the COVID-19 pandemic, the transportation sector in the country has taken a massive hit. So much so that the commercial vehicle segment in India witnessed a whopping decline of 89% in sales for the month of March. While the passenger vehicle segment saw a drop in sales by 52%, commercial vehicle OEMs bore the brunt of this deadly disease.
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The combined commercial vehicle sales in March by leading commercial vehicle manufacturers such as Tata Motors, Ashok Leyland, Mahindra and Mahindra, Eicher Motors and Maruti Suzuki came out to be only 11,683 units, as per the sales update by these companies. The numbers point towards a shocking annual decline by 89%, in contrast to 1,07,119 units that were sold by these giants in total in March 2019.
Talking about Tata Motors, one of the leading CV manufacturers in the country, the domestic sales witnessed a decline by 89.52% by selling only 5,336 units in March this year, as compared to 50,917 units sold in the same month the previous year. International sales did not fare well either, with only 1,787 units being sold, in contrast to 5,619 units that were sold in the March 2019.
According to Girish Wagh, President, CV Business Unit, Tata Motors, “Domestic sales in March were deeply impacted by the Covid-19 lockdown as well as the planned transition to BS-VI,”.
He further added, “Almost all BS-IV vehicles in the ecosystem have been retailed, however some await registration which was halted due to the lockdown. This will be cleared in the window provided,”.
For Ashok Leyland, the story was just as bad in terms of sales. Domestically, the company sold only 1,787 units in March 2020, taking a hit of 91% from March 2019, wherein the company had sold 20,521 units.
Mahindra and Mahindra too reported shocking numbers for March 2020, with a sale of 2,325 units, witnessing a sharp decline of 90%. Meanwhile Volvo Eicher Commercial Vehicles Ltd. saw a drop in sales by 83% on an annual basis, managing a sale of 1,499 units in the previous month.
As per Shamsher Dewan, Vice President, Corporate Sector Ratings, ICRA Ltd., “The macro economic environment is bad and the fleet operators are struggling to pay their debts. So there is no question of buying new trucks. Furthermore, the demand for consumables has declined too, this will impact the demand for light and intermediate commercial vehicles (LCVs and ICVs),”.
Since CV sales have come to a staggering halt, CV OEMs are fighting tooth and nail to retain customers by providing extended support services to their customers. For instance, Tata Motors and Ashok Leyland have individually taken up measures to provide roadside assistance to trucks stranded on highways due to the lockdown, along with extending the warranty period for vehicles under their brand.