Indian Commercial Vehicle Industry
“Factors -favorable or Unfavorable”
GROUP-6 SECTION-B
NMP-28
CONTENTS
Title Page number
Chapter-1 Introduction
1.1 Overview 3
1.2 What is shaping India’s commercial vehicle industry 4
1.3 Summary 4
Chapter-2 Research methodology
2.1 Introduction 5
2.2 Need for study 5
2.3 Statement of the problem 5
2.4 Research objectives 5
2.5 Hypothesis 6
2.6 Literature review 6
2.7 Survey method 7
2.8 Sampling 8
2.9 Data collection 9
2.10 Method of data analysis 9
2.11 Summary 9
Chapter-3 Data Analysis & Interpretation
3.1 Introduction 10
3.2 Demographic details of the respondents 10
3.3 Frequency of response 11
3.4 Descriptive statistics 11
3.5 Testing of hypothesis 12
3.6 Summary 17
Chapter-4 Summary, Finding, Conclusions and Recommendations
4.1 Summary 18
4.2 Findings 18
4.3 Limitation 18
4.4 Conclusions 19
4.5 Recommendation 20
Appendix A- Questionnaire 21
1
Executive Summary
Scope & objective
The aim of the study made through this project is to know the impact of the various
factors on the demand of commercial vehicles in India & use various statistical tools to
substantiate the results.
Research methodology
1. research design
2. sampling plan
3. instruments of collection of data
4. data analysis and interpretation
The questionnaire method is adopted for the collection of data. The level of agreement to
the 13 statements are allowed to mark in 5 point score Likert-scale. The sample has been
drawn from the population based on the judgment method. The duly filled questionnaire
is collected from the respondents. The frequency and descriptive statistical analysis of
responses are carried out. The statistical approach ANOVA, T test is used for the analysis
of responses.
Conclusion
Various factors contribute in the increase in sales & demand of commercial vehicles in
India & based on the questionnaire survey conducted we can conclude that manufacturing
process , freight rate , fuel price , road connectivity will affect the demand & sales of
commercial vehicles in India.
Limitation
Within the limit period of time it is too difficult to cultivate in a whole market. Cost is
also a major factor of pushing back to us in our research.
Recommendation
The research analysis recommended that the company & government may look into the
following aspects reviewed in this research in Likert-scale, to increase sales & demand of
commercial vehicles.
Improvement in manufacturing process
Reduction in freight rate
Reduction in fuel price
Reduction in interest rate
Improvement in road connectivity
2
Chapter 1
Introduction
1.1 Overview
The Indian commercial vehicles (CV) industry has a long history, possibly dating back to
the passenger vehicles industry. Telco, the first entrant in the segment, continues to be the
largest till date, with a market reach unrivalled by its competitors. Telco pioneered
production of commercial vehicles in the country with technical collaboration with
Daimler-Benz of Germany in 1954.
The industry has made a significant contribution to the country’s industrialization and
progress. In fact, India achieved self-sufficiency in commercial vehicles, except in the
high-tonnage classes, where the demand has nonetheless been limited. The entry of
Ashok Leyland, with technology from British Leyland, marked the beginning of
competition in the truck and bus segment
Emerging from a two year down cycle
After two years of down cycle, some segments of the domestic Commercial Vehicle (CV)
industry have shown signs of recovery in FY 2015. In the first ten months of the fiscal,
the pace at which domestic CV sales have been declining has reduced to 4.6% compared
to a contraction of 20.2% witnessed during FY 2014(Exibit-1). Within the CV space, the
Medium & Heavy Commercial Vehicle (M&HCV) Truck segment has in fact posted
a positive growth of 19.0% in 10m FY 2015 while the HCV (16T+) segment,
which accounts for almost half of total M&HCV (Truck) sales has been witnessing
strong demand (up 42.6% in 10m FY 2015) on back of replacement demand (following
two years of deferment) and capacity addition by organized fleet operators to
some extent.
While the M&HCV Truck segment seems to have bottomed out, the LCV Truck
segment is still experiencing sluggish trends (down13.8% YoY) as significant
capacity addition over the past few years and constrained financing environment amidst
rising delinquencies remains a challenge for the segment.
3
1.2 What is shaping India’s commercial vehicle industry?
After a few years of strong growth, the Indian commercial vehicle (CV) industry hit a
rough patch last year, impacted by the overall economic slowdown, delay in
infrastructure projects and weak investment sentiment. However, the industry has long-
term growth potential, subject to the economy accelerating back to 7–8% GDP growth
per annum and the government expediting policies that support growth in manufacturing
and infrastructure development While deregulation of diesel prices will make the industry
dependent on subsidies, it is likely to create demand uncertainty in the short-term as truck
owners and manufacturers adjust to the new normal
To prepare for the years ahead, industry participants in the Indian CV industry should
answer the following questions to evaluate how well they are positioned to respond to the
emerging opportunities and challenges:
How will the demand & sales of trucks (Heavy vehicles) evolve?
How will products need to adapt?
How will business models need to adapt?
What are the new market dynamics?
What are the supply or value chain issues and implications?
With respect to above industry analysis we had identified following mega trends that are
likely to impact and change the face of the Indian CV industry
1.3 Summary
In this context we will identify the most important factors among the 6 factors that will
impact the sales & demand of commercial vehicles in India. With this project we also
identify new factors that can impact the demand of commercial vehicles in India
4
Chapter 2
Research methodology
2.1. Introduction
According to Green and Tall “A research design is the specification of the methods and
procedures for acquiring the information needed. It is the overall operational pattern or
framework of the project that stipulates which information is to be collected, from where
it is to be collected and by what procedures.”
The research methodology used is to evaluate the accuracy and effectiveness of the
findings & its effect on demand of commercial vehicles. The quantitative data is collected
by questionnaire method from a convenience sample. The responses are analyzed and
arrived at conclusions
2.2. Need for study
1. Crucial role in Make in India campaign
2. Very crucial for Indian growth story as it is a major component of supply chain of
goods and transport
3. The project is of interest to both domestic and international automobile
manufacturers
2.3 Statement of purpose
The study is aimed at to evaluate the various factors which affect the demand & sales of
commercial vehicle in India.
2.4 Research objectives
It’s always better to start your search with a predefined objective, rather than beating
around the bush. An objective will give you a direction to work upon and proceed your
further research. Therefore, my project objective is,
Identify the various factors which affect the demand & sales of the commercial
vehicles in India.
Illustrate the way in which the identified factors affect the commercial vehicles.
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2.5 HYPOTHESIS
The suggested hypothesis for each of the research objectives is developed .The
hypothesis as per the research objectives are as follows
a) Interest rate , Fuel price & Freight rate will impact the sales of CV
b) Goods Roads and connectivity will improve sales of CV
c) Regulatory (legal) provisions will impact sales of CV.
d) Improvement in manufacturing process will increase sales of CV
2.6 LITERATURE REVIEW
