August saw accelerated growth in commercial vehicle (CV) sales as major manufacturers reported significant double-digit increases in volumes. This growth was supported by increased freight transport, infrastructure activity, and demand for fleet replacement ahead of the holiday season.
The sharp year-on-year increase is partially explained by a favorable base: in August last year, CV supply volumes were moderate due to uncertainty related to upcoming changes in Goods and Services Tax (GST). However, consistent sales and retail registrations indicate strengthening underlying demand.
Ashok Leyland's domestic CV sales increased by 43% year-on-year, reaching 19,438 units in August compared to 13,622 units. Similarly, Tata Motors' domestic CV volumes grew by 33%, totaling 36,619 units versus 27,481 units. Mahindra's CV sales in the sub-3.5 ton segment rose by 22%, reaching 27,415 units.
Mahindra's trucks and buses business, including MTBD and SML Mahindra, separately reported a 47% rise in total sales, including exports, increasing from 1,701 to 2,495 units. VE Commercial Vehicles (VECV), a joint venture between Volvo Group and Eicher Motors, recorded a 19.8% growth in domestic CV sales, reaching 7,584 units.
It is worth noting that three out of four manufacturers also demonstrated consistent growth. Domestic volumes for Tata Motors and Ashok Leyland grew by approximately 8% compared to July, while Mahindra's CV volumes in the sub-3.5 ton segment increased by almost 9%. VECV showed relatively stable sequential volumes.
Retail demand further confirms that the rise in wholesale sales was not entirely driven by a low base. According to InCred Research, Vahan vehicle registrations for CVs grew by 22% year-on-year in August.
Arun Agarwal, Vice President of Fundamental Research at Kotak Securities, noted that the CV segment showed sustained demand in August, driven by 'improved fleet operator sentiment and GST-related demand stimulation.' Agarwal added that wholesale volumes grew by over 20% year-on-year in both Medium & Heavy Commercial Vehicles (M&HCV) and Light Commercial Vehicles (LCV).
Heavy trucks lead the growth
Strong momentum was particularly visible in the heavier segment of the market. Ashok Leyland's Medium & Heavy Commercial Vehicle (M&HCV) sales jumped by 55%, reaching 12,408 units compared to 7,991 units the previous year. Among these, M&HCV truck sales increased by 60% to 10,285 units, and bus sales grew by 36% to 2,123 units. The company's LCV volumes rose by 25% to 7,030 units.
At Tata Motors, sales of Medium, Heavy, and Intermediate Commercial Vehicles (MH&ICV) grew by 31%, reaching 17,531 units from 13,405 units. Within its broader domestic portfolio, the company increased HCV truck volumes by 42%, intermediate and light medium-duty trucks by 20%, passenger carriers by 31%, and small trucks and pickups by 34%.
Light Commercial Vehicles (LCV) typically have a maximum gross weight of up to 7.5 tons, intermediate CVs range from 7.5 to 12 tons, medium-duty CVs from 12 to 16 tons, and heavy CVs are over 16 tons.
Mahindra's heavier business also showed a similar trend. Truck sales in its Trucks & Buses division grew by 55%, and passenger vehicle sales increased by 35%, indicating that the August growth extended beyond the light commercial vehicle market.
Vinod Sahai, Executive Chairman of SML and President of Aerospace Technologies, Trucks, Buses, and CE at Mahindra & Mahindra, stated that 'the truck and bus segment continues to be supported by higher infrastructure spending, growing transport demand, and replacement demand, while facing challenges related to rising raw material and fuel costs.'
Sahai also highlighted the favorable base, noting that 'volumes were moderate in August 2025 due to expected GST changes, so this month's growth also reflects last year's low base.'
Momentum builds before the festive season
Demand factors are expected to remain supportive as the industry enters the festive months. Girish Waghm, Managing Director and CEO of Tata Motors, previously stated that 'looking ahead, with the support of a robust product portfolio, continuous innovation, and relentless focus on delivering the best customer value, we remain confident in strengthening our market leadership and ensuring sustainable, profitable growth in the coming quarters.'
InCred Research forecasts that improvements in industrial production and growth in the core sector will support CV demand, although tensions in the Middle East, fuel prices, and raw material cost inflation remain risks.
Agarwal also pointed out the divergence between domestic and export markets. In August, retail car sales volume grew by over 15% year-on-year, while export figures remained volatile as manufacturers with a larger presence in West Asian markets faced disruptions due to the conflict in Iran.
Thus, the domestic market for CV manufacturers enters the festive period with stronger momentum than a year ago.
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