The second wave of COVID-19 has put the brakes on a rebound in India’s commercial vehicle market, reports Aditya Kondejkar, Power Systems Research Analyst for South Asia Operations, in the May 2021 issue of Motorindia magazine.
Kondejkar notes that the second wave of the pandemic has caused shortages of semiconductors and steel as well as weaker consumer demand. These forces have pushed commercial vehicle production down nearly 60% month-on-month (MoM) in April.
Kondejkar points out that the India CV market witnessed a strong performance in 2018 with more than 1.13 million
units produced, owing in large part to GST implementation and replacement demand. In 2019, however, the Indian CV market began shrinking as it faced headwinds from revised axle load norms, vehicle over-capacity, BS-VI transition, and a liquidity crunch.
The market decline continued to a historically low production volume of 0.5 million units in 2020 as the CORONA pandemic spread. Although the Indian economy managed to recover after the first wave, from April 2020 through today the medium and heavy commercial vehicle (MHCV) segment has been the hardest hit of all vehicle categories.
In Q3 2021, the government’s aggressive investment in infrastructure and construction activities helped boost the struggling MHCV segment. However, when the CV industry was about to accelerate, the second wave of CORONA-19 hit. Read Kondejkar’s analysis here. PSR
