Tough road ahead for CVS

The commercial vehicle sector has shown signs of an uptick as a resultof a pickup in roadbuilding activity and the government's push on infrastructure. However, high fuel prices and supply constraints due to the Ukraine war remain areas of concern. Areportby Sumana Sarkar.

- Sumana Sarkar

For the Indian automotive sector, FY22 was a year impacted by supply constraints, raw material shortages and the uncertainty caused by the second wave of the pandemic as well as high fuel prices. Yet, after eight consecutive quarters of degrowth, the CV sector was able to record a 25 percent improvement in sales in the current fiscal. Collections of Fastag and e-way bills were positive signs too in the year gone by.

One factor behind this good growth was the LCV segment that saw that increased sales as companies deployed last mile solutions - especially the e-commerce sector - to cater to their customers. The segment has grown a healthy 11 percent over the past fiscal based according to retail data released by companies. Together with the M&HCV segment, which clocked 33 percent growth last fiscal, it has helped the CV pick up some of the momentum it had in the pre-covid times.