Commercial Vehicles Global Snapshot—2016: The 5th largest CV market in the world, India will soon be 4th largest behind only the USA, China and Canada with about 1 Million sales by 2022

Commercial Vehicles—Historic trends: CV production peaked in FY2012 riding on domestic demand; market grew at a CAGR of 9% making India the 5th largest CV market behind China, the US, Canada and Japan

India to be 4th biggest market for Commercial Vehicles; OEMs can make Indian a production hub catering to African and Asian markets

Scope & Limitations

A Glance at FY2017*—Lower than expected GDP growth and demonetization: both negatively affected the CV industry

CV Sector Players—Market domination by Tata, Ashok Leyland & Mahindra continues; However, competition intensity is rising; will continue to challenge market leaders

CV Domestic Sales: Market Share—FY2017: Entry of new players & higher focus by existing smaller players to challenge market leaders in each segment; OEMs to be ready for higher competition on all fronts

Major Applications Affecting CV sales—Replacement demand of Market load a major factor deciding overall MHCV sales; STU and Intercity transport are the biggest contributors in Bus segment

Total UIO by application—Cement, POL, Construction material and Agriculture are the major contributors of CV demand apart from market load; OEMs can offer customized solutions for these

Estimated Growth in Application segments—Cars, 2-wheelers, road construction, Iron Ore and FMCG/FMCD to be major drivers of growth in CV sales; Going forward OEMs to focus on these segments

Mega Trends—Impact on Commercial Vehicles: OEMs to look for opportunities with smart solutions for smart cities

Factors and Trends—Urbanization and Smart cities will boost demand for CV; OEMs should look into new business opportunities in cities

Emission Norms—BS-6 (Euro 6) standards in 2020 will have huge cost impact will lead to big pre-buying in 2019; OEMs should learn from BS-4 experience to avoid losses

Declining Overloading Practice (MHCV Segment)—Overloading reduced to a great extent in the past, further expected to decline in all application segments except Mining and Construction Material (aggregates)

Dedicated Freight Corridor—Impact on CV: Once operational, DFC will have a negative impact on demand of M&HCV for primary transportation of mostly bulk commodities

Segment Shifts—Multi Axle Rigid Truck segment Evolution: Many applications have moved from lower tonnage segments to higher tonnage improving productivity per truck but negatively impacting truck sales

Segment Shift—M&HCV Bus Segment: >12T GVW segment share declined from 66% to 57% caused mostly by shift of School and staff segment to <12T GVW; ICV segment should not be ignored

New Trends in Passenger Transportation—Demand for better comfort across all Bus segments causes decrease in passenger capacity per bus and increase in demand of buses; focus on improving comfort

Vehicle Scrapping Policy Background (V-VMP)—If vehicle scrapping policy is implemented, estimated increase in demand of M&HCV is up to 66,000 units and LCV up to 130,000 units in a year

GDP Growth Assumptions—Stable Government at least until 2019 will ensure steady growth in GDP

GDP Forecast—Scenarios: GDP growth expected to rise in next 2 years on lower base and high Government spending; Consumption growth to drive overall demand for freight movement, hence CVs

Forecast—Goods Carrier: Growth to revive in FY2019 reaching new heights in FY2020; pre buying in FY2020 due to BS-6 implementation will lead to a drop in volumes in FY2021

Forecast—Passenger Carrier: M&HCV-Buses will grow on demand from STUs & intercity operations; LCV-Buses demand to remain stable; pre buying due to BS-6 to also have effect

List of Abbreviations

Maximize opportunities from existing products and markets; systematically explore new products, markets, including inorganic Opportunities

Growth Consulting—Service Offerings

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