2nd wave to slowdown CV sales growth to 23-28%

Mumbai The intense second wave of Covid-19 afflictions and consequent lockdowns will limit growth in the domestic commercial vehicle (CV) sales volume to 23-28 per cent this fiscal, compared with 32-37 per cent expected prior to its onset, Crisil said on Monday. Volume growth had hard-braked to a decadal low last fiscal. But according to the ratings agency, credit metrics of CV makers are expected to improve as margins expand on better capacity utilisation and product mix.

The CV market saw two consecutive fiscals of steep volume decline (29 per cent and 21 per cent in 2020 and 2021, respectively), following multiple headwinds such as revised axle norms, BS-VI transition, and the pandemic. While a sharp recovery from the lows was on the cards this fiscal, it will be constrained by a weak first quarter because of the second wave of the pandemic, the agency said in its report that accessed the CV market in India. In April, freight rates fell 20 per cent even as diesel prices remained elevated, hurting fleet operators.