New Delhi — After witnessing sluggish growth over the past two financial years, India’s commercial vehicle (CV) wholesale sales are projected to rise by 2–5% in FY26, according to a report released on Monday.
The CareEdge Ratings report forecasts that the medium and heavy commercial vehicle (MHCV) segment will grow by 4–6% this fiscal year, while the light commercial vehicle (LCV) segment is expected to expand by 2–4%.
“The commercial vehicle sector is likely to see moderate growth, with overall sales volumes expected to improve by around 2–5% year-on-year in FY26,” said Arti Roy, Associate Director at CareEdge Ratings.
Roy attributed the expected recovery to factors such as increased infrastructure development, improved rural sentiment supported by a normal monsoon forecast, easier vehicle financing following recent interest rate reductions, and ongoing fleet replacement, especially in the bus segment. She also highlighted incentives like road tax concessions for new vehicles under the vehicle scrappage policy and the growing shift towards electric vehicles (EVs).
The report noted that FY25 saw muted growth due to weak demand across both the MHCV and LCV segments. Despite this, MHCV sales recorded a marginal 1.2% rise, while LCV sales declined by 0.3%.
MHCV growth was restrained in FY25 due to prolonged monsoon conditions delaying construction projects. The LCV segment also faced headwinds from increasing competition posed by electric three-wheeler cargo vehicles and cautious lending behavior among small fleet operators.
“The Indian CV industry hit its peak sales volume in FY19. Though it was severely impacted by the Covid-19 pandemic, the sector showed signs of a strong rebound in FY22 and FY23, coming close to surpassing those record highs,” said Hardik Shah, Director at CareEdge Ratings.
Buses, which account for nearly 20% of all MHCVs, saw strong momentum in FY25, with sales rising 21.6%. This surge was driven by the accelerating adoption of electric buses, government-backed fleet replacement programs, and rising demand for public transport, the report stated.
With inputs from IANS