New Delhi, July 7 Commercial Vehicle (CV) wholesale volumes in India are expected to recover by around 2–5 per cent in FY26 after registering a subdued growth in the past two financial years, a report said on Monday.
The medium and heavy commercial vehicle (MHCV) segment is projected to grow by 4–6 per cent in the current financial year, while light commercial vehicle (LCV) segment is expected to grow by 2–4 per cent in the same period, a CareEdge Ratings report showed.
“The commercial vehicle (CV) industry is expected to experience moderate growth, with overall sales volume likely to improve by around 2-5 per cent YoY in FY26,” said Arti Roy, Associate Director, CareEdge Ratings.
The recovery will be driven by increased infrastructure activity, improved rural sentiment on the back of normal monsoon forecast, more attractive vehicle financing due to recent interest rate cuts, and ongoing fleet replacement — particularly in the bus segment — spurred by ageing vehicles, road tax concessions available for new vehicles under the scrappage policy for older vehicles and the transition to electric vehicles (EVs), Roy explained.
Muted growth in FY25 was due to a slowdown in demand in both MHCV and LCV segments. Despite the low demand, MHCV volumes saw a modest increase of 1.2 per cent, the report stated, whereas LCV volumes declined by 0.3 per cent.
MHCV volumes witnessed subdued growth in FY25, following an extended monsoon which had delayed construction activities. Increased competition from the electric cargo three-wheeler market and cautious financing sentiment among small fleet operators also had an effect on the LCV segment.
“The Indian CV industry had witnessed its highest sales volume in FY19, and after being adversely impacted by the Covid-19 pandemic, the industry appeared to be on track to surpass the all-time high on the back of significant growth in sales volumes in FY22 and FY23," said Hardik Shah, Director, CareEdge Ratings.
Buses, which make up about 20 per cent of all MHCV, showed a robust growth trajectory within the MHCV segment, increasing by 21.6 per cent in FY25 due to the ongoing shift to electric buses, government fleet replacement programmes, and growing demand for public transportation, according to the report.
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