A washout year for passenger commercial vehicle segment

According to FY21 sales data released by the Society of Indian Automobile Manufacturers (SIAM), sales of passenger medium and heavy CVs dropped 81.7% year-on-year and those of passenger light CVs dropped 73.6%, even as the goods counterparts of these sub-segments dropped just 16.8% and 11.5%. While goods CVs appear to be coming out of recession —until the second wave hit, their month-on-month sales were rising consistently — analysts argue that passenger CVs (buses and mini-buses) will take a very long time to recover, and CY2021, in all possibility, could be a washout for this sub-segment. Major buyers of buses and mini-buses in India are state transport undertakings (STUs), schools, offices, private transporters and contractors who service schools, corporates, hotels, etc. With schools closed, work from home likely to be a permanent feature at some corporates, and tourism activity not expected to pick-up for some time, sales of buses may remain muted.