Outlook and trend analysis of commercial vehicles in the Indian CV industry.
The Indian Commercial vehicle industry stood at 10.65 Lac units for FY 2018-19 registering a growth YOY growth of 17%. However, there has been a slowdown in the industry in the first half of this fiscal. For the first five months, industry is down by 21% vis a vis same period last year. General economic slowdown in the global economies, slowing pace of domestic GDP growth and liquidity crunch are the prime reasons for the slowdown in demand in the first two quarters of this fiscal. Financial closures of the HAM road projects already awarded and the rising cumulative order book to revenue ratio of major road construction players and financing mechanism for new projects are some of the other critical issues that Govt. is trying to tackle to continue its mission of building roads.
Brief on products offered by Tata Motors in the Commercial Vehicle space
Tata Motors Group (Tata Motors) is a $45 billion organisation. It is a leading global automobile manufacturing company. Its diverse portfolio includes an extensive range of cars, sports utility vehicles, trucks, buses and defence vehicles. Tata Motors is India’s largest and the only original equipment manufacturer (OEM) offering extensive range of integrated, smart and e-mobility solutions.
The core focus areas while planning, designing the Tipper trucks for the mining industry in India.
Mining applications are broadly divided into light, medium and heavy mining. These include varied applications like stone quarry, iron ore mines, coal mines deploy tippers for removing overburden and getting the ores/ material extracted.
Mining activity largely demands off-site and far-away operations, wherein the efficiency of tippers needs to be very high. TATA tippers have comfortable cabins, proven powertrain, robust chassis, and better payload capacity. The chassis used in mining tippers are strong to perform on difficult terrains. Special grade of mining tyres helps to increase the tyre life and load caring capacity. The frames used in mining tippers are reinforced and have thicker dimensions to carry more load. Mining applications need rugged heavy-duty vehicles with very good manoeuvrability and gradeability.
On the feature font, customers wish to have performance enhancing features, which will add to the safety and provide a better operating efficiency in-terms of payloads, carrying strength, mileage and easy serviceability and lower maintenance. To ensure faster unloading, many mining tippers have scoop type body of stronger grades of steel as well as Hardox material. Customers are increasingly looking at safety features and efficient braking.
Our Prima and Signa, designed with powerful 300HP, 250HP and 230HP engines, range of tippers such as Tata PRIMA 3130, PRIMA 2530, LPK 2523, Prima Lx 2525.K and Tata Prima Lx 3125.K are best suited for light and medium duty mining and off-road applications.
Growth opportunities from the mining industry for the Commercial Vehicle segment.
With several road development projects in pipeline, stone mining and its subsequent transportation from the quarry to crusher is expected to revive and stabilise in the future.
India’s iron ore production is expected to grow at 5 per cent annually during 2016-2020 and hit around 200 million tonnes by 2020. India’s demand for steel is expected to be decent given the quantum of infrastructure projects. However, there are concerns over the global demand for Steel. Low forecast of demand of ores from China and availability of ores from Brazil and Australia at competitive rates is likely to put stress on the domestic production of ores. Demand would largely be from domestic consumption and renewal of the mining leases.
Coal India has set a production and sales target of 660 million tonne for this fiscal, which it plans to scale up to 710 million tonnes in the next financial year. During 2024-25, the company aspires to achieve a production of 940 million tonne of coal.
In the near future, demand for commercial vehicles in the mining sector should stay neutral to moderate, boosted primarily, by the country’s positive reforms and vast mineral reserves. There will be a shift to high powered vehicles as the depth of mines increase and performance standards improve.
