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Commercial vehicle makers bullish on fully built trucks, buses

Companies expected the share of FBVs to rise from 20% currently, to 40% in next few years

Sohini Das  |  Ahmedabad 

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and expect demand for fully built vehicles (FBVs) to grow as legislation mandating manufacturers to build safer commercial vehicles, including safer cabins for drivers, is in the pipeline.
 
Industry estimates put the proportion of FBVs sold by truck manufacturers at 20 per cent and this is set to grow to 40 per cent. Subrata Ray, senior group vice-president, ICRA, said with and focussing on this segment, the share of FBVs could rise to 40 per cent over the next few years.
 
FBVs are ready-to-use commercial vehicles customised for the type of goods to be transported. “With norms like the new Bus Body Code and ABS becoming mandatory, customers are turning to OEMs for complete trucking solutions,” a spokesperson said.
 
plans to take the share of FBVs in its truck sales to 50 per cent within three years. has a capacity to manufacture 160,000 heavy commercial vehicles and 70,000 a year. It is utilising 60-70 per cent of its capacity and sold 84,255 last year.
 
set up a dedicated division for FBVs in 2002. All small, light and intermediate commercial vehicles up to 15 tonnes are sold as cabin and load, which classify them as FBVs.
 
“Nearly 75 per cent of our light buses and tippers sold are FBVs and 25 per cent of the 5,000 bus orders received in 2016-17 were fully built. Additionally, a large number of heavy tippers are sold as FBVs,” a spokesperson said.
 
Anuj Kathuria, president, global trucks, Ashok Leyland, said, “We plan to offer more ready-to-use vehicles to our customers. This will help improve the top line as the ticket size will increase.” plans to make dry containers, refrigerated vehicles, LPG bullet and bulkers among others.
 
“The trend of selling FBVs is more apparent for application-based where body-building costs are higher. The cost of building the body for tankers, tippers, trailers and refrigerated vans are Rs 1 00,000, Rs 200,000 lakh, Rs 500.000-600,000 lakh and Rs 400,000-500,000 lakh, respectively,” the spokesperson said.
 
“We recently launched our new Signa range of commercial vehicles with a new comfortable cabin and a telematics system as standard fitment, making our ‘connected’, just like cars,” the spokesperson added. 
 
Ray said making FBVs might not be a high margin business, but greater value addition was likely to sustain demand.
 
“Post GST, there will be consolidation of warehouses, leading to demand for specialised trucks,” he added.
 
The refrigeration transportation market is expected to grow at an annual rate of 17 per cent in the next five years. Refrigerated are expected to clock a growth rate of 85 per cent over five years.

First Published: Sat, June 24 2017. 23:08 IST