Expectations of truck buyers in India are evolving rapidly with the expansion of faster highways and rising freight movement, according to Ashok Leyland Managing Director and CEO Shenu Agarwal. Customers are no longer focused on minor price changes or fuel efficiency alone, as they are prioritising higher productivity, lower total cost of ownership, and better uptime.
“Our customer expectations are changing even faster. You know the highways are getting better. A lot of customers or a lot of shippers are expecting much faster turnaround times,” Agarwal said while relaunching Ashok Leyland’s TAURUS and HIPPO trucks on Thursday. As speed limits on roads improve, fleet operators and shippers are demanding quicker turnaround times and higher asset utilisation.
“Whenever a highway gets built, the whole logistical efficiency increases on that particular road. And therefore, the expectation from the shipper is that can you get my cargo quicker? If it used to take 10 hours, can you bring it in 8 hours or 7 hours?,” Agarwal said. According to him, the market is no longer driven by price. Instead, buyers are looking at value creation, which can improve their earnings.
“Customers are not looking at cost anymore. They are really looking for value more and more. In our recent conversation with a larger buyer, we noticed that he was talking about EV, LNG and total cost of ownership. Not even for a moment did the price issue come up,” he said.
It is to be noted that there has been a gradual shift towards higher tonnage trucks, with gross vehicle weight in M&HCV trucks growing significantly over the last decade. This is driven by factors such as better economic viability of higher tonnage trucks, the introduction of new and improved higher tonnage models by OEMs and improving road infrastructure.
Ashok Leyland’s management indicated that the benchmark of trucks in India is also rapidly improving. “The most important point is that you have to have a higher average speed, which these new highways actually allow. To do that, what is really required is that we put more torque in these vehicles. We always used to think why Europe is selling 400, 500 horsepower trucks while India is still selling 250, but that thing is now changing very, very fast,” Agarwal said.
He also pointed out that strong service support is another important thing influencing purchase decisions, as downtime in commercial vehicles translates into lost operating income. “We have recently analysed the life cycle cost of the truck. Just to share with you, the asset cost is hardly 10%, and 90% is the cost of running that truck. So, the initial cost of the asset actually does not affect; it is more about how the truck is run, how it is maintained,” he added.