Volvo Group Optimistic About India’s Thriving Commercial Vehicle Market

India’s potential for exponential growth in the next decade and its increasing significance in the global manufacturing operations of the Volvo Group were highlighted by Sofia Frandberg, the chairperson of VE Commercial Vehicles (VECV), a Swedish company specializing in commercial vehicles, engines, and construction equipment. Frandberg, on her first visit to India since assuming her position, emphasized the tremendous growth experienced in all segments that VECV is involved in, including buses, trucks, engines, and components. She also mentioned the significant investments made in technology, product development, industrial capacity, and digitization, positioning the company for further expansion and enabling it to manufacture in India for both local and global markets.

In the fiscal year 2022-2023, VEC Commercial Vehicles emerged as the country’s fourth-largest commercial vehicle manufacturer with sales totaling 72,827 units. The company’s sales soared by 54% in the previous fiscal year, surpassing the industry’s 34% growth rate, which recorded a total of 962,468 vehicle sales. VECV also exported 4,933 vehicles in the same period. Additionally, VECV has become the sole global manufacturer of 5-litre and 8-litre diesel engines for Volvo and now supplies driveline parts, gears, and other critical components to the Swedish company. The company’s component exports to Volvo and other original equipment manufacturers (OEMs) reached approximately Rs 400 crore in the last fiscal year, and VECV anticipates significant growth in component export revenue in the future.

Vinod Aggarwal, the managing director at VECV, highlighted the substantial increase in revenue from the component business and expressed confidence in the potential for growth in vehicle exports once international markets recover. Frandberg, also a senior leader at Volvo Group, praised the successful 15-year partnership between VECV and Eicher Motors, expressing the desire to further expand the alliance. The collaboration has made VECV responsible for managing the international sales of commercial vehicles under the Eicher brand, as well as Volvo trucks and buses in India. Frandberg expressed optimism in the growth opportunities presented by the fast-growing Indian economy, noting that India is on track to become the third-largest economy globally. She mentioned the readiness of technology, products, and production capacity to cater to this expanding market.

Frandberg identified five key factors that will shape India’s future development, namely decarbonization and a focus on sustainable mobility, deglobalization, digitalization, demographics, and the potential for increased diversity. She emphasized Volvo Group’s strong belief in India and its strengths as a country.

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