Commercial vehicle sales, revved by ecommerce

Ecommerce, as we know, has been being very fruitful for almost all the business sectors including FMCG. And now it’s the commercial vehicle sector that has been at a benefit!

Yes, the ease of online shopping has boosted the sales of various types of goods and now, people are even ordering their automobiles online! Quite unbelievable, isn’t it?

Some leading commercial vehicle manufacturers have acknowledged that ecommerce is one of the topmost contributors to their strong business performance these days.

Tata Motors is India’s top commercial vehicle manufacturer that sells an average of 13,500 light commercial vehicles every month. According to its Executive Director, Mr. Ravi Pisharody, they have already sold around 1000 mini trucks which are used for last mile deliveries. In a month, they retail around 100 to 200 small commercial vehicles that are used for deliveries of ecommerce-related goods. And if the consumption continues to accelerate beyond the traditional sales, it would result in higher demand of trucks in the heavy duty segment as well.

The Managing Director at Ashok Leyland also holds similar views on this topic. According to him, ecommerce has certainly helped them to increase sales. In order to avoid the hassle of going to the store and purchase, customers are now preferring to order vehicles online.

As stated by the Transport Corporation of India in their latest annual report, logistics requirements for ecommerce will grow at the same pace as of ecommerce itself. Specialized needs of the escalating ecommerce and cold chain industry will spawn a range of opportunities for niche-organized logistics players.

However, ecommerce still accounts for only a small part of the domestic freight sector, the growth potential is big. Over the next three to four years, the revenue opportunity from the ecommerce boom is likely to be as high as $500 million (Rs 3,400 crore).

While the demand has so far been mostly for light vehicles which are utilized for last mile deliveries, the industry executives expect it to spill over to the heavy vehicles segment as well.

Today, people are getting most of their stuff online right from groceries to gadgets and the trend will certainly continue. May the predictions and statistics of India’s ecommerce market vary, but nothing can cut-off the growth and impact of ecommerce!