Liquidity crunch fails to put brakes on commercial vehicle sales

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High interest rates and unavailability of finance seems to have no impact on the sales of commercial vehicles with most players witnessing a double-digit growth in May and June.

Interestingly, on month-on-month basis also, the volumes are going up which means, even the high double-digit inflation and the increase in prices of commercial vehicles is not dithering buyers to go in for a big buy.

While sales of Tata Motors, India’s largest commercial vehicle manufacturer grew by 25% in June at 26,797 units as against 21,417 units during the same period last year, Ashok Leyland witnessed a growth of 10.6% in domestic sales at 6,435 units as compared to 5,816 units in June last year.

“The industrial sector has been growing and has increased the demand for commercial vehicles, more so in the medium and heavy vehicle (M&HCVs) segment,” an industry expert, said. Tata Motors’ registered a growth of 9% in sales of M&HCV at 12,845 units last month, slightly more than 11,742 units sold by company in May.

Similarly, Ashok Leyland also posted a growth of 10.37% in the sales of M&HCVs at 6,362 units as against 5,764 units sold in June last year, surpassing 5,119 units it sold in May, this year.

“Though light commercial vehicles (LCVs) have always taken a back seat vis-à-vis M&HCVs, but lately due to the robust trend of organized retail, vehicles like Tata Ace and others are becoming useful for logistics, especially within the city where the movement of bigger vehicles is restricted and hence, even this segment is growing at a fast pace,” the expert added.

While, LCV s sales of Tata Motors grew by 45% at 13,952 units,that of Ashok Leyland were not far behind,growing at 40.38% to 73 units in June last month as compared to 52 units in the corresponding period a year ago. In May, Tata Motors sold 11,940 units of LCVs, while Ashok Leyland sold 42 units during the same period.