Medium and Heavy Duty Commercial Vehicles Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Medium and Heavy Duty Commercial Vehicles Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The medium and heavy-duty electric vehicle market segment is expected to grow from USD 274.31 billion in 2020 to USD 432.75 billion by 2025 at a CAGR of 7.89%.

With the world manufacturing units being shut down due to Covid - 19 pandemic, production was stopped. Due to this, the need for transporting was completely reduced. Due to disruption in the supply chain, leading truck manufacturers stopped the production. But the increased need for transport in the aftermath of the Covid-19 pandemic is the ray of hope for medium and heavy-duty commercial vehicles. With the gradual relaxation of lockdown and restrictions, the medium and heavy-duty commercial vehicles market has a great chance to bounce back from the economic crisis.

Some of the major factors driving the growth of the market are the expansion of industrial sectors in the emerging market, growing demand from the logistics industry, rising demand from the construction sector (owing to growing construction activities). The market is expected to witness growth in the coming years, owing to growing economies across both developing and developed counties.

Owing to consistent technological advancements and enactment of stringent emission norms, automakers (OEMs) are shifting there focus towards electric vehicles. The increasing number of construction and e-commerce activities resulted in an increase in demand for material transportation, which in turn, resulted in increased sales of commercial vehicles, worldwide. This is likely to drive the growth of the commercial vehicles market in the near future.

Key Market TrendsElectric Commercial Vehicle to Witness Faster Growth

Across the globe, some of the countries have banned old commercial vehicles running on public roads to tackle the growing levels of vehicle emissions. Thus, the possibility of freight businesses, adopting new commercial vehicles that are eco-friendly, cost-effective, and align with the emission standards, will increase at the global level during the forecast period.

Analyzing the above situation and growing vehicle emission standards, the automakers continue to invest in R&D activities and plans to successfully develop and launch more electric commercial vehicles during the forecast period. For instance, Renault Trucks, after ten years of experimentation of its all-electric truck unveiled medium and heavy-duty electric vehicles in 2018 namely Renault Trucks D Wide Z.E and Renault Trucks D Z.E ideally suited for use in the cities of France. Renault is planning to launch Truck Models D and D Wide Z.E commercially in 2019.

The heavy-duty commercial electric vehicle market, which is driven by logistics and the developments in the construction & e-commerce industry, is expected to witness significant growth in the coming years, with good opportunities opening in infrastructure, logistic and transportation sectors.

Furthermore, government incentive and subsidies, along with structural & functional improvements in design drives the sales of hybrid and electric trucks.

Heavy-duty Commercial Vehicle Segment is Projected to Grow at a Fast Pace in Asia Pacific

The heavy-duty commercial vehicle segment of the market is projected to register a CAGR of 5.35%, during the forecast period.

The heavy-duty commercial vehicles (HCV) include vehicles with a gross vehicle weight rating greater than 16 metric ton, such as heavy trucks and buses. The demand for downsized engines, along with the deployment trend of multi-axle vehicles, is anticipated to boost vehicle performance.

During 2018-19, China, Europe, and ASEAN countries have seen a decline in the sales of HCVs. The fall in the sales of HCVs in the aforementioned regions in 2018 is due to few factors: slow economic growth, fluctuations in the growth of tourism and logistics sectors, and stringent trade policies. North American regions and countries, such as India and Japan, witnessed positive sales for HCV, in 2019. In India, heavy truck sales reached an all-time high at 351128 units in September 2019, 15% higher than the previous year’s 304313 units.

Owing to the growing tourism and increasing construction and logistics activities across several countries in the world, the demand for heavy-duty commercial vehicles is likely to increase during the forecast period. China’s One Belt One Road initiative is a highly ambitious project that serves the purpose of constructing a unified market with geographies around World through road, rail and sea routes. Neom Project is a venture of Saudi Arabia that aims at developing a smart futuristic city with a total area of 26500 square kilometers and a total length of 460 kilometers. Thus, to capture the growing demand for HCVs at the global level, during the forecast period, automobile manufacturers have initiated plans to expand their HCV business in the potential regions.

Owing to the growing demand for operational efficiencies and achievement of economies of scales by companies in various sectors, commercial vehicle leasing and rental market is also on the rise.

Competitive Landscape

The market studied is a moderately consolidated and is captured by major players, like Daimler AG, Toyota Motor Corporation, Scania and MAN trucks owned by the Volkswagen group, Volvo Trucks, ISUZU and Mitsubishi Motor Corporation among others with Daimler AG leading the market.

• Daimler Truckshas planned to invest a total of more than EUR 2.5 billion in R&D during 2018-2019, to focus on the on-going trends of the automotive industry such as e-mobility, connectivity, and automated commercial vehicle technology.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support

Companies Mentioned

PACCAR Inc.
Daimler AG
Volvo Group
MAN SE
Tata Motors Limited
Renault Trucks
Isuzu Motors Ltd.
Scania AB
FAW Group Corporation
Hyundai Motor Company (Hyundai Commercial Vehicle)
Dongfeng Motor Corporation

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