After a sluggish run for months, commercial vehicle makers have reported a double-digit growth in volumes sold to dealers last month. This, however, is a bit surprising as transporters have voiced concerns over a drop in freight rates and dip in demand after rollout of goods and services tax (GST).
Leading player Tata Motors reported a 15 per cent growth in sales of commercial vehicles at 27,842 units last month. “After a sluggish Q1, our commercial vehicles in the domestic market in July grew 15 per cent due to a ramp-up of BS-IV production. Passing on the benefits of GST to consumers by reducing the prices of vehicles across all commercial vehicle segments has resulted in improved consumer sentiments,” said Girish Wagh, head of commercial vehicle business unit at the company.
With the commercial vehicles segment, Tatas’ sales of medium and heavy commercial vehicles grew 10 per cent in July to 8,640. This segment, which was seeing a decline in the last few months, saw a rebound in July and witnessed pick-up in demand and availability because of continued production ramp-up, Wagh added.
Ashok Leyland said its July commercial vehicle sales grew 14 per cent to 11,981 units. Sales of medium and heavy commercial vehicles grew 10 per cent to 9,026 units. Mahindra and Mahindra clocked a 14 per cent growth in commercial vehicle sales to 15,023 units last month. All three companies saw decline in sales during the April-June quarter.
S P Singh, an industry expert and an advisor with CTC Logistics, which has a fleet of 550 trucks, said manufacturers are resorting to steep discounts to sell vehicles and utilise manufacturing capacities.
“Dealers are sitting idle and select products are in demand”. It is learnt that demand for cargo movement have softened post GST as many unorganized manufacturing units are not operating at full capacity.
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