Commercial vehicle makers like Tata Motors see sales surge after ecommerce boom

NEW DELHI: The fast-growing ecommerce sector is rubbing off on the commercial vehicle segment, helping boost sales when bulk purchases have yet to come from traditional customers in the infrastructure industry.

Senior executives at leading commercial vehicle manufacturers acknowledge the contribution of ecommerce-related logistics in the industry's recent strong performance, and they expect it to increase. While ecommerce still accounts for only a small part of the domestic freight industry, the growth potential is significant. For commercial vehicle makers, the revenue opportunity from the ecommerce boom is projected by some executives at as high as $500 million ( Rs 3,400 crore)over the next three to four years.

"We have already sold around a 1,000 mini trucks which are being used for last-mile deliveries. Over and above this, we retail 100-200 small commercial vehicles (a month), which are utilised for ecommerce-related goods movement," said Ravi Pisharody, executive director (commercial vehicle business) at Tata Motors the nation's top commercial vehicle maker that sells on an average 13,500 light commercial vehicles a month. "If consumption continues to increase over and above traditional retail, we expect it will result in higher demand for trucks in the heavy duty segment as well."

Vinod Dasari, managing director at Ashok Leyland, also has a similar view. "It (ecommerce) is definitely helping. Instead of somebody going to the store and purchasing, consumers are now ordering online. These products are shipped from some central warehouses and transport has to be (through) trucks. It is increasing our business."

Tata Motors