Commercial vehicle segment set for growth with expanding economy: VECV MD

The industry is expected to grow over the next few years with the economy slated to cross the $5 trillion mark, he noted

Domestic commercial vehicle industry is expected to touch the peak sales volume of 2018-19 this fiscal and grow briskly over the next few years coinciding with the growth of the overall economy, VE Commerical Vehicles MD and CEO Vinod Aggarwal said on Monday.

He noted in the first seven months (April-October), the heavy duty truck segment has grown by 15 per cent.

"We are expecting that this year the industry should either be very near to the peak or it may even cross earlier peak of 2018-19," Aggarwal told PTI here in an interaction.

The industry is expected to grow over the next few years with the economy slated to cross the USD 5 trillion mark, he noted.

"There are fundamental reasons for this growth in the next few years. If we look at the economy, we are now at around USD 4 trillion mark and this economy is going to reach the USD 5-7 trillion mark the way it is growing," Aggarwal said.

And if the economy grows, the commercial vehicle industry also grows because when more goods are produced more commercial vehicles are required to move them from one place to another, he noted.

Secondly, the new age customers like e-commerce companies seek better turnaround time and therefore old trucks are expected to be replaced by new ones leading to enhanced sales for the industry, he said.

"When new trucks are offering a better cost of ownership then it means the old trucks cannot do the job...the e-commerce customers, they define very clearly that my goods need to be delivered in so many hours. They do not tolerate if a truck delivers late...So therefore all the older trucks will come back for replacement," Aggarwal said.

Besides, there is huge investment lined up for infrastructure development in the country and that augers well for the growth of the commercial vehicle industry, he noted.

"When you have more capital investments, more infrastructure projects it means you need more construction trucks because cement and steel can only be moved by trucks or by railways," Aggarwal said.

Elaborating on how VECV, a joint venture between the Volvo group and Eicher Motors, is gearing up to meet the enhanced demand, he noted that the company is ready to offer technologically superior products in the market.

"We are absolutely well placed to shape up the future of the commercial vehicle industry," Aggarwal said citing long association with the Volvo group.

He also noted that the company is working on host or alternative powertrains to prepare for the future.

On Friday, the company introduced four heavy-duty trucks under the Eicher Non-Stop Series for the fast-evolving long-haul transportation requirements in the country.