India’s Commercial Vehicle Industry Likely to Grow 4–6% in FY27: ICRA

India's commercial vehicle (CV) industry is likely to post wholesale volume growth of 4-6 per cent year-on-year in FY27, with the high base of the previous fiscal likely to moderate the pace of expansion, according to credit rating agency ICRA. The ratings agency expects the medium and heavy commercial vehicle (M&HCV) truck segment to grow by 1-3 per cent during the fiscal, while light commercial vehicle (LCV) truck volumes are projected to rise by 6-8 per cent, reported PTI.

The buses segment is forecast to record the strongest growth, with volumes expected to increase by 7-9 per cent.

"ICRA expects the domestic CV industry to register a moderate YoY growth of 4-6 per cent in wholesale volumes in FY2027," the report said.

According to ICRA, the broader base created in FY26 is likely to influence growth momentum this fiscal, even as demand remains supported by continued infrastructure spending, improving freight movement and replacement purchases.

At the same time, the ratings agency identified higher fuel prices and financing constraints as key challenges for the sector.

The report noted that domestic commercial vehicle wholesale volumes rose 13.5 per cent year-on-year in May 2026, although they declined 1.1 per cent compared with the previous month.

Retail sales also remained positive, increasing 5.3 per cent year-on-year in May, while registering a sequential decline of 18.3 per cent.

ICRA further noted that commercial vehicle retail volumes grew at a faster pace in rural markets than in urban areas, indicating that demand for goods movement is expanding beyond metropolitan regions.

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