Tata Motors has been at the forefront of constantly innovating and defining the market with new technologies and categories. Rajesh Kaul, Vice-President, Marketing and Sales, Commercial Vehicles, Tata Motors, elaborates on the company's plans and market outlook.
How is the market progressing for tipper trucks?
Medium and heavy commercial tippers (16 tonne GVW and above category) industry (TIV) for the FY 2018-19 registered an unprecedented growth in the demand for tippers, on the back of faster execution of the construction projects. Government spending increased multi-fold on infrastructure and road development projects.
As compared to last year same period (April-November) of this fiscal FY 2019-20 has seen a drop of 45 per cent. For the period April 2019 to November 2019, the tipper industry stood at around 30,500 units.
There has been a slowdown in first few months of this fiscal due to the tightening of the liquidity policy, elections and the general slowdown in the global economy. Slowdown continued through the monsoon months because of slow progress of construction and infrastructure projects. Third quarter (Q3) has given some green shoots with demand picking up in road construction, RMC and mining segments. Q3 has seen an increase in enquires and we are optimistic of seeing an increase in demand for tippers in the remaining period this fiscal. Pre-buying on account of BS VI implementation and replacement of old vehicles will boost the demand in the last quarter of this fiscal.
What are the key demand drivers of tippers?
The requirement of tippers for the industry comes from primarily two applications, aggregate mining and surface transport. Road infrastructure is one of the key focus areas for the Indian Government as the roads carry more than 60 per cent of all goods and 85 per cent of the total passenger traffic. The road construction push includes the Bharatmala Pariyojana with a Rs 5.35 trillion investment to construct 34,800 km of roads. In addition, Rs 1.57 trillion will be spent on the construction of 48,877 km of roads by the National Highways Authority of India (NHAI) and the Ministry of Road Transport and Highways. Also, there has been good demand on account of building of smart cities, SEZ projects, irrigation projects and other infrastructure projects across the country. A restart and expedition of pending projects, as well as renewal of mining licences eventually leading to an increase in the mining activities will further boost the tipper industry.
What are the new developments in the market?
The BS VI transition, without doubt, is the most talked about subject today for tipper and commercial vehicle industry. On the feature front, customers wish to have performance-enhancing features, which will add to the safety and provide a better operating efficiency in terms of payloads, carrying strength, fuel efficiency, easy serviceability and lower maintenance costs. With the ongoing focus on fast time-bound project development, OEMs have been working to increase efficiency of trucks and tippers.
OEMs have equipped their trucks with sophisticated features, which were otherwise seen, so far, only in passenger vehicles. We are attracting buyers on fuel efficiency, drivability, safety and comfort. New safety technology such as Electronic Stability Control, Automatic Traction Control and "Hill Start" aid are being made available that will go a long way in preventing vehicle accidents.
Automatic Traction Control prevents wheel spin during acceleration under different surface conditions, especially slippery surfaces like mines, water and ice. This prevents loss of traction of one or more wheels and further helps increase tyre life by significantly decreasing loss of traction. Similarly, Hill Start Aid prevents roll-back of vehicle during stop-and-go situation on an uphill gradient and helps minimise clutch and brake liner wear. Engine brakes, which have recently been introduced in some of our tipper models, further improve the braking efficiency in downhill operations.
Digital technology is also being used to increase efficiency and raise the safety bar. For instance, fleet owners can make use of digital technology to better utilise their fleet through trip assignments and tracking of vehicle.
What are the technology trends in tippers?
As the market leader in the commercial vehicle segment, Tata Motors has been at the forefront of constantly innovating and defining the market with new technologies and categories. Tata Motors has conceptualised and engineered a new modular platform across its commercial vehicle range.
Tata Motors has set a benchmark in technology, comfort and safety in the Indian commercial vehicle segment. We launched Tata Fleetman for commercial vehicles in 2013 and today it has more than 1,50,000 connected vehicles across the country. Tata Fleetman brings in the cutting-edge telematics technology and offers remote diagnostics, fuel efficiency tracking, driver behaviour mapping along with location mapping, which helps the fleet owners garner more efficiency and thus offering more economic benefits.
Features such as "track and trace", "trip playbacks", "geo-fencing" in addition to "driving behaviour monitoring" help immensely in improving operational efficiency. The state-of-the-art technology in Tata Motors commercial vehicles is very well accepted and appreciated by the fleet owners. This technology helps in better upkeep of the vehicles, reduces downtime and allows faster responses to breakdown - that directly translates into higher profit margins for our customers. These technological breakthroughs and offerings are also capable of providing smart recommendations and actionable insights into the customer's fleet operations. Our connected vehicle technology also leverages the nationwide reach of Tata Motors dealer network to offer its services in all corners of the country.
What are the challenges and opportunities in the upcoming emission regulations? Post the implementation of BS VI norms, the vehicular pollution across the country will drastically reduce, however the migration to BS VI is a huge challenge for all the players across the auto industry, including Tata Motors. The time within which India has moved from BS IV to BS VI is among the fastest across the world. Also, BS VI technology is relatively more expensive. But it is just the initial phase and we expect things to settle down in the coming months.
Tata Motors is not only adapting its vehicles to pass the more stringent BS VI emission norms, but also transforming its entire range of commercial vehicles to be truly enhanced products in terms of efficiency, reliability, comfort and safety. With regards to BS VI transition readiness, Tata Motors is well on track in the areas of product development, certification, production and field readiness. It will showcase its new, improved and BS VI compliant range at the Auto Expo 2020.
How are you gearing up to the new emission regime?
Tata Motors has invested significantly towards the technology upgrades for meeting the BS VI requirements. Tata Motors received BS VI Type Approval certificate for its 3.8L NA SGI CNG engine from the Automotive Research Association of India (ARAI), becoming the first OEM in India to achieve BS VI certification for a naturally-aspirated CNG engine for commercial vehicles. In the recent past, we have showcased our new-generation BS VI upgradable Diesel Turbotronn engines that offer best-in-class fuel economy, excellent performance, lower TCO and will be launched across our entire CV range.
For Tata Motors, the migration to BS VI is an opportunity to change our approach beyond emission standards by not only meeting the regulations but also to improve our end customer's business potential and deliver better value resulting in overall consumer satisfaction.
Tata Motors follows a four-pronged approach when it comes to preparing itself for BS VI transition:
How do you look at the future of tipper trucks market?
Tata Motors is optimistic about the future trends in the tipper market and the overall commercial vehicle market. We believe that the worst is already behind us and we expect to see a positive turn in volumes, going forward. A lot also depends on the long term stability and government's thrust on infrastructure. The government is mulling on ways to deal with some financial closures of the HAM road projects already awarded, project over-runs due to issues like land acquisition, rising cumulative order book to revenue ratio of major road construction players, increasing repayment cycles and further need and mode of arranging funds for development works. With a stable and development-oriented government at the Centre, we believe that there will be decent demand for construction vehicles, including tippers, in the future.