India’s Commercial Vehicle Sales To Speed Up In FY2025-26: Report
ICRA expects long-term growth drivers for domestic CV industry
India’s Commercial Vehicle Sales To Speed Up In FY2025-26: Report
New Delhi: The domestic commercial vehicle (CV) industry’s wholesale volumes is set to witness a year-on-year growth of 3-5 per cent in FY26, demonstrating some recovery, a report showed on Monday.
This follows a flat volume movement estimated in FY2025, marred by the demand slowdown in the first half of the fiscal due to the Lok Sabha elections, according to an ICRA report.
Commenting on the outlook for the industry, Kinjal Shah, senior vice president at ICRA, said: “Resumption of construction and infrastructure activities, steady rural demand along with higher replacement sales stemming out of ageing fleets and Government mandates are the likely driving factors to propel this volume expansion towards the end of FY2025 and through FY2026.”
ICRA expects the long-term growth drivers for the domestic CV industry to remain intact. The sustained push in infrastructure development, evidenced by the higher infrastructure capital outlay in the recent budgetary allocation, a steady increase in mining activities and the improvement in roads/highway connectivity are expected to support volumes going forward.
The replacement demand would also remain healthy, primarily due to the ageing fleet, estimated at around 10 years for the medium & heavy commercial vehicles (M&HCVs) and is expected to aid the industry volume expansion in the medium term, according to the report.
Among the various sub-segments, the M&HCV (trucks) wholesale volumes are likely to grow by up to 3 per cent YoY in FY2026 after seeing a flattish growth or marginal contraction in FY2025.
Resumption of construction and infrastructure activities is likely to aid the low YoY volume increase in FY2026. The segment reported a 7 per cent YoY contraction in the April-December period of FY2025, with the tipper volumes contracting by 11 per cent YoY, and the haulage and tractor-trailer sub-segments each declining by 5 per cent YoY. Wholesale volumes for the domestic light commercial vehicles (LCV) (trucks) are expected to see a modest 3-5 per cent YoY expansion in FY2026, after registering a flattish growth or marginal contraction in FY2025.
