truck sales: Rising Covid-19 cases slam the brakes on truck sales growth; revival likely only by FY23: M&M

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Commercial vehicles maker said that the growth trajectory of the sector tapered in the third quarter of FY22 and the emergence of the Omicron variant and rising Covid-19 infections has slammed the brakes on growth which is likely to revive only by the first quarter of FY23.

Truck buyers have gotten into a “wait and watch mode,” said Veejay Nakra, the chief executive officer for the automotive sector at M&M.

“We are already seeing that with Omicron coming in, certain segments and categories have already started showing flattening of growth and even de-growth in some cases,” he said.

Despite this, the truck industry was likely to close this fiscal with a double-digit sales growth over the forgettable sales of FY21. The first half of the previous fiscal year saw sales dip to the lowest in over a decade before improving in the latter half.

“The current slowness that’s come into the market will continue in Q4 and hopefully as Omicron settles down, industry starts reviving, Q1 of next year when we will see revival,” Nakra said.

About 146,600 medium and heavy trucks were sold in India between April and December 2021, a growth of 75% over the preceding year. M&M accounted for a little over 2% of this.

To capture a larger market share from leaders Tata Motors and Ashok Leyland, the company on Monday said that it will return the money of its customers if their M&M truck gave lower fuel efficiency than a comparable product from rivals.

To shore up sales numbers, the company was also working on CNG-powered intermediate and light trucks. With the rising prices of diesel, almost a third of the sales in the lighter truck segment have shifted to CNG vehicles, said Jalaj Gupta, Business Head for the commercial vehicles business unit at M&M.

Tata Motors leads the market in terms of sales of CNG-powered trucks in absence of products from rivals. Ashok Leyland too is preparing its range of CNG-powered trucks.

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