Social distancing due to Covid-19 may boost demand for buses: VECV

VECV says that traditionally, February to July is the period when schools buy a lot of buses. This year, because of the lockdown, schools are closed, so very little buying has happened. Also, because tourism has stopped (it was the summer vacation period), the tourist bus segment has taken a hit.

By:July 23, 2020 10:47 AM

While overall commercial vehicle (CV) sales declined 84.81% in Q1FY21, those of passenger CVs (i.e. buses) declined over 95%—97.71% for M&HCVs and 94.6% for LCVs. However, the continued social distancing norms may raise the demand for buses in India, believes Vinod Aggarwal, MD & CEO, VE Commercial Vehicles (VECV). “Due to social distancing norms, seating arrangement in buses may change—buses are expected to run at 50% of their normal seating capacity—and this may lead to an increase in demand over the next 1-2 years,” he said. A lot will, of course, depend on when schools reopen and when companies such as those in the IT/BPO sector restart working from office, and their purchasing power. These are among the biggest bus customers in India, in addition to state transport corporations and private transport operators. “Traditionally, February to July is the period when schools buy a lot of buses. This year, because of the lockdown, schools are closed, so very little buying has happened. Also, because tourism has stopped (it was the summer vacation period), the tourist bus segment has taken a hit,” Aggarwal added.

As far as goods carriers are concerned, Aggarwal said that, traditionally, during the monsoon season, people delay purchases (to the festive season). This year, in addition to that trend, a lot of the existing fleet is idle due to lockdown in certain parts of the country, so sales are muted. “We expect a lot of pent-up demand, perhaps as early as September-October this year onwards,” he said. The company is currently working at 25-30% capacity-utilisation levels at its manufacturing plant in Pithampur, Madhya Pradesh. The company on Wednesday launched its Eicher Live connected services for the entire range. From August 1 onwards, all its trucks and buses built on the EUTECH6 platform (BS6) will be equipped with pre-fitted hardware—including an eSIM provided by Vodafone—using which operators/owners can track & trace their vehicles remotely, access fuel-efficiency and fuel-pilferage data, assess driver performance, and even get access to services such as remote and predictive diagnostics.

“In times of low economic sentiment, operators want to reduce the total cost of ownership, and this solution can help them achieve the same,” added Aggarwal. These connected services are available at zero additional cost and for two years there will be no subscription charges. “Post that there will be nominal charges which we will soon arrive it,” he said.

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