Domestic CV Sales To Grow 3–5% In FY26: ICRA

The domestic commercial vehicle (CV) industry will likely register a 3–5 per cent year-on-year growth in wholesale volumes in FY26, according to ICRA. This comes after a slight 1.2 per cent decline in FY25, the ratings agency said in its report released on Monday.

ICRA stated that resumption in construction and infrastructure activities, along with a steady economic environment, will drive the expected growth.

Domestic CV wholesale volumes recorded a marginal 0.1 per cent year-on-year increase in the previous month and grew 1.6 per cent sequentially. However, April–May FY26 saw a 0.7 per cent year-on-year decline in wholesale volumes.

Retail volumes in May 2025 declined by 3.7 per cent year-on-year and 11.3 per cent sequentially. ICRA said this indicates elevated inventory levels at dealership ends.

Mixed trends across CV segments

In the medium and heavy commercial vehicle (M&HCV) segment, retail volumes dropped by 4.4 per cent year-on-year in May. Sequentially, the segment saw a larger decline of 18.9 per cent.

ICRA said regional disruptions and geopolitical tensions had some impact on demand during the month.

The M&HCV (trucks) wholesale volumes are expected to grow by 0–3 per cent year-on-year in FY26, after a 4 per cent decline in FY25. Meanwhile, the light commercial vehicle (LCV) segment saw a 3.2 per cent year-on-year and a 4.9 per cent sequential decline in May retail volumes, pointing to muted demand.

ICRA noted that the preference for pre-owned vehicles has affected LCV demand. Despite this, LCV (trucks) wholesale volumes are projected to grow by 3–5 per cent in FY26.

The M&HCV (trucks) and LCV (trucks) segments will likely see modest year-on-year growth of 0–3 per cent and 3–5 per cent, respectively. In contrast, the buses segment is expected to post higher growth of 8–10 per cent in FY26.

ICRA added that rising construction and mining activities will support demand in both truck segments. Replacement demand will likely boost bus sales. The overall commercial vehicle growth in FY26 will depend on economic stability and infrastructure momentum.

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