Commercial vehicle makers see ecommerce demand surge

NEW DELHI: Commercial vehicle makers are seeing a significant boost in demand from the ecommerce segment after a bulk of economic activity embraced the digital mode in the wake of the outbreak of the coronavirus pandemic and consumers preferring online shopping, a welcome change for the sector that has seen sales come from the infrastructure sector.

At

Tata Motors

, as much as 7-10% of M&HCV (medium and heavy commercial vehicles) and I&LCV (intermediate and light commercial vehicles) cargo sales this fiscal year have come from ecommerce sector compared to the previous year when the sales salience was less than 5%.

Chennai-based

Ashok Leyland

, too, is seeing a surge in demand with as much as 25% of sales in ICV and haulage coming from this sector. The ecommerce sector has begun to feature among top 10 buyers for both companies.

1

“FY21 has seen good growth in ecommerce buoyed by increased demand shift from offline to online in consumer segments, the rapid increase in online sellers on the ecommerce platform, steady addition of new ecommerce platforms in India, larger number of transporters entering ecommerce logistics and higher and wider logistics needs. Ecommerce is emerging as one of the big sectors for the transportation industry,” confirmed Girish Wagh, president, commercial vehicles business unit, Tata Motors.

In terms of the logistics requirement of the ecommerce sector, nearly half of it is met by road transport while the rest of the cargo goes by rail/air when there is less than 24 hours of commitment. Last-mile distribution is done by commercial vehicles and some of it also happens on two-wheelers. Along with the absolute quantum of business, the share of road transport in carriage of ecommerce cargo is expected to increase over the next few years, generating demand for commercial vehicles.

“The ecommerce sector primarily uses ICV and 4X2 18.5 T GVW vehicles. Due to the Covid-19 pandemic we have seen a surge in this sector and it has grown faster than other sectors. We have seen 25% of sales in ICV and haulage from this sector,” said Anuj Kathuria, chief operating officer of Ashok Leyland.

While Bangalore, Mumbai, Pune, Ahmedabad, NCR and Chennai have emerged as major hubs for ecommerce activity, the Pune-Bangalore, Mumbai-Delhi, Bangalore-Delhi, Chennai-Mumbai, Nagpur-Kolkata are the busiest routes for ecommerce traffic.