Light Commercial Vehicle Market Estimated to Witness High Growth
SWOT Analysis
Strength: Light Commercial Vehicles have high fuel efficiency. With changing emission norms, automakers are focusing on upgradation of powertrain technologies to enhance fuel efficiency and reduce emissions. LCVs also have lower acquisition and maintenance costs as compared to heavy commercial vehicles. Furthermore, LCVs have better maneuverability which allows transportation of goods in congested city areas with ease.
Weakness: High price sensitivity is observed in the LCV segment. Buyers look for value for money proposition. Increased raw material costs like steel prices affect profitability of automakers. LCVs have limited payload capacity in comparison to higher tonnage trucks.
Opportunity: Growth of e-commerce and logistics sector is driving the demand for last mile delivery. LCVs are preferred for last mile delivery owing to their maneuverability. Stringent emission regulations will propel adoption of alternative fuel powered LCVs like CNG, electric in the coming years. Developing regions offer huge growth potential for LCV sales.
Threats: Rising prices of fuels increase operational costs of fleet owners. Economic slowdowns impact sales volume of commercial vehicles. Shared mobility poses a potential threat as more goods can be transported using smaller shared vehicles. Preference may shift towards used LCVs to reduce ownership costs.
Key Takeaways
The Global Light Commercial Vehicle Market Size is expected to witness high growth over the forecast period. Stringent emission regulations and expansion of e-commerce are driving demand for fuel efficient and alternative fuel powered LCVs. The Asian region currently dominates the LCV market with India and China being the largest markets. Both countries are witnessing strong growth in e-commerce and logistics industries resulting in increased LCV sales.
Key players operating in the Light Commercial Vehicle market are Daimler AG, Ford Motor Company, Renault SA, Ashok Leyland Ltd, VE Commercial Vehicles Limited, Tata Motors Ltd, SML Isuzu Limited, GM Group, Mahindra & Mahindra Ltd, Volkswagen AG, Toyota Motor Corporation and Stellantis NV. These companies are focusing on adoption of alternative fuels and connectivity features to gain market share.
The global Light Commercial Vehicle market size for 2023 is estimated to be US$ 633.98 Bn registering a CAGR of 8.1% during the forecast period of 2023 to 2030. Growing last mile delivery and preference for fuel efficient vehicles is expected to drive the growth.
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