Commercial Vehicles Market Size Poised to Exceed $3.07 Trn By 2030

The global commercial vehicles market reached  USD 1.81 Trillion in 2022 and predicted to expand USD 3.07 Trillion by 2030 and poised to grow at a  CAGR of 6.8% from 2022 to 2030.

The commercial vehicle industry is entering a new era. Although profits and revenues are still being primarily derived from diesel vehicles, new technologies are drastically affecting investments by original equipment manufacturers (OEMs) and companies product development strategies. Commercial vehicle is a type of vehicle that is used mainly for transporting people, goods, and providing other types of services. They contribute significantly to the economy of a country. They are used for various applications such as logistics, passenger transportation, industrial, mining & construction, and many more. Commercial vehicles are further classified as light commercial vehicle and heavy commercial vehicle. Heavy commercial vehicles are generally used for transporting heavy equipment or goods whereas light commercial vehicles are used in passenger transportation and small logistics work.

Challenges for commercial vehicle OEMs seeking a leading position in the market are becoming more difficult owing to new technologies such as autonomous driving and alternative powertrains. However, OEMs are balancing their position by laying the foundations for these technologies and also by maintaining existing business profitability.

Key Takeaway

• By product, the light commercial vehicles segment held highest revenue share of over 78% in 2021.
• The buses & coaches product segment is exhibited to reach at a CAGR of 3.6% between 2022 to 2030.
• By end user, the logistics segment hit highest revenue share of over 26.8% in 2021.
• The passenger transportation end user segment is registering growth at a CAGR of 8% beween 2022 to 2030
• The Asia Pacific region is anticipated to grow at a CAGR of 4.2% over the forecast period.

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Commercial Vehicles Market Growth Factors

Introduction of telemetric and connectivity have revolutionized operations due to which various original equipment manufacturers (OEMs) have launched commercial vehicles equipped with numerous connected services, such as traffic data, accident warnings, weather reports, and updates on roadwork’s. This contributed as a major factor that fuels the market growth. Furthermore, developments in the field of semi-autonomous commercial vehicles as well as electric vehicles (EVs) expected to positively influence the market growth over the forecast period. Advent of vehicle electrification and battery-powered engines expected to fuel the demand for light commercial vehicles in the coming years.

Further, growth in the industrial sector also escalates the demand for LCV prominently. However, buses and coaches segment expected to gain traction over the analysis period due to its rising adoption in the healthcare and tourism sector. Governments of various regions have significantly implemented the green mobility and rapidly replacing traditional buses and other mode of public transport into smart and electric based vehicles that prominently fuels the growth of the segment.

Market Trends

The use of cloud computing in the CV industry has risen dramatically, owing to several properties that have enhanced the performance of these vehicles. Cloud computing plays an important role in vehicle production and its services range right from the operation stage and design to management. Functions such as the remote location of vehicles and storing and retrieving this data that come with cloud computing can reduce costs, thereby minimizing and reducing waste. Cloud computing allows seamless communication with these vehicles from remote locations and helps retrieve and store data.

RESTRAINING FACTORS

Governments in several countries across the world are taking measures to develop their domestic automotive industry, whilst maintaining the safety of passengers and pedestrians. For example, the European Union (EU) has implemented strict regulations to reduce the incidence of road traffic accidents, ensure the safety of passengers and drivers, and curb rising fuel emissions. It has also imposed strict laws on auto manufacturing companies to control exhaust emissions.

Governments of some economies have formulated emission policies, such as India’s BSVI emission standard, Europe’s European VI, and China’s China VI, with the goal of reducing emission levels by setting emission limits. However, governmental mandates to install a catalytic converter in gasoline- or diesel-powered vehicles in some countries and also the emphasis on the downsizing of engines are some aspects leading to a rise in the cost of vehicles. All these measures taken by governments and the various laws imposed by regulatory authorities on the automotive industry have forced manufacturers to comply, increasing manufacturing costs in the process and resulting in high purchase costs for these products.

Report Highlights

• North America captured maximum market value share in the global commercial vehicles market and anticipated to grow at a 4% of CAGR during the forecast period.
• The Asia Pacific registered the highest growth rate over the analysis period. This is attributed to the increasing road infrastructure along with rising manufacturing facilities due to cost-effective raw materials and labor, particularly in the developing countries such as India and China.
• Based on product, Light Commercial Vehicles (LCVs) led the global commercial vehicles market with significant revenue share of around 75% and predicted to retain its position during the forecast period. In 2020, passenger transportation accounted for significant market value share and predicted to exhibit lucrative growth rate of nearly 8.3% over the forecast period. Rising expenditure on commutation to improve accessibility and affordability is one of the prime factors that escalate the growth of the segment.
• Logistics segment witnessed prominent demand in the past few years owing to the growth in trade activities worldwide. Moreover, the segment captured remarkable revenue share 25% in 2020 due to increasing penetration of e-commerce and retail business.

Read More: Electric Vehicle Market To Surpassing US$ 4.0 Billion by the End of 2032

Regional Snapshots

North America occupied the largest revenue share in the global commercial vehicles market in 2019 and projected to continue the same trend over the analysis period. This is attributed to the significant government support for the adoption of smart and environment-friendly vehicles in the region. Rate of carbon emission and greenhouse gas has crossed the environment standard in the region. In order to curb the emission from transportation sector government has issued attractive policies to promote the adoption of electric vehicles across the region. Significant development in the industrial sector along with stringent government norms pertaining to load carrying capacity of the commercial vehicles is the prime factor that triggers the growth of the region.

On the other hand, the Asia Pacific registered the fastest growth over the analysis period. Rising investment in road and transport infrastructure along with increasing manufacturing facilities particularly in the developing nations such as India and China accounted as the prime factors to drive the growth of the region. In addition, green revolution in various countries in order to favor the green mobility solution and other smart & attractive solutions in other sectors expected to propel the adoption of advanced vehicle solutions, thereby fuelling the growth of the region.

Key Players & Strategies

The global commercial vehicles market is a matured market and expected to be dominated by the presence of major market players. In 2019, major portion of the revenue share was captured by some of the industry participants that include Volkswagen AG, Tata Motors, Volvo Car Corporation, Ashok Leyland, and General Motors. These players are significantly focusing towards vertical integration in value chain to speed up their production process. In the wake of same, Original Equipment Manufacturers (OEMs) are adopting partnership, collaboration, and merger & acquisition strategies.

Some of the key players operating in the market are Bosch Rexroth AG, Ashok Leyland, Daimler, Toyota Motor Corporation, Volkswagen AG, Mahindra and Mahindra, VOLVO, TATA Motors, General Motors, and Golden Dragon among others.

Market Segmentation

By Product

• Light Commercial Vehicles (LCVs)
• Buses & Coaches
• Heavy Trucks

By End-use

• Mining & Construction
• Industrial
• Passenger Transportation
• Logistics
• Others

By Propulsion Type

• IC Engine
• Electric Vehicle

By Power Source

• Gasoline
• Diesel
• HEV / PHEV
• Battery Electric Vehicle (BEV)
• Fuel Cell Vehicle

By Geography

• North America
• Europe
• Asia-Pacific
• Latin America
• Middle East & Africa (MEA)