Light commercial vehicles or LCVs are utility vehicles primarily used for transportation of goods and services. They are used in various sectors including logistics, retail, construction, and others predominantly for last mile delivery purposes. LCVs offer high fuel efficiency, affordability and easy handling compared to heavier commercial vehicles. Common LCV body types include pick-ups, vans and mini-buses. With the rapid growth of e-commerce, logistics, and construction industries globally, the demand for last mile delivery transport has increased significantly over the years. This rising demand for last mile delivery is expected to drive the growth of the light commercial vehicle market during the forecast period.
The global Light Commercial Vehicle Market is estimated to be valued at US$ 633.98 Bn in 2023 and is expected to exhibit a CAGR of 8.1% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
The two main drivers for the growth of the light commercial vehicle market are the rising demand for last mile delivery and increasing e-commerce sales. With the growth of the e-commerce industry, the demand for fast and efficient last mile delivery has increased exponentially in the recent years. LCVs have become the primary mode of transport for last mile deliveries owing to their compact size and affordability compared to heavier vehicles. Their easy maneuverability allows for deliveries even in congested urban areas. Another major factor fuelling the LCV demand is the growth in construction industry activities globally. As infrastructure and construction projects pickup post pandemic, the need for transportation of materials and equipment has surged thereby positively impacting the light commercial vehicles market.
The light commercial vehicle market can be segmented based on propulsion type, vehicle type, and sales channel. By propulsion type, the diesel segment dominates with over 75% share owing to benefits such as better fuel efficiency. However, the petrol and electric vehicle segment are expected to witness strong growth during the forecast period due to stringent emission norms and increasing demand for green vehicles. By vehicle type, the pickup segment holds the largest share due to wide applications in construction and logistics. The mini trucks and vans segment is also significant owing to growing preference for last-mile delivery.
Political: Stringent emission regulations in nations like China, India, and European countries are promoting shift towards electric commercial vehicles. governments provide subsidies for EV adoption.
Economic: Growth of e-commerce and logistics sector is fueling demand for last-mile delivery vehicles. Rising infrastructure projects and industrial activities have increased cargo transportation. However, rising fuel prices and taxes can impact industry growth.
Social: Rising living standards are increasing demand for goods transportation. Young population prefer eco-friendly modes of transportation. However, lack of adequate charging infrastructure hinders EV adoption.
Technological: Developments in lithium-ion batteries, electric powertrains, and telematics are facilitating greener LCVs. Connected vehicles technologies enable fleet management and predictive maintenance.
The Global Light Commercial Vehicle Market Growth is expected to witness high during the forecast period owing to rising demand for last-mile delivery and fleet modernization. The market size is projected to reach US$ 1,045.56 Bn by 2030 from US$ 633.98 Bn in 2023, growing at a CAGR of 8.1%.
Regional analysis: Asia Pacific dominates the market with over 50% share led by China, India, and ASEAN countries. This is attributed to robust economic growth, rising e-commerce, and infrastructure development. Countries like India and China are expected to witness fastest growth supported by government schemes for electrification of fleets.
Key players: Key players operating in the light commercial vehicle market are Daimler AG, Ford Motor Company, Renault SA, Ashok Leyland Ltd, VE Commercial Vehicles Limited, Tata Motors Ltd, SML Isuzu Limited. Daimler and Ford have strong presence across global markets. Renault, Ashok Leyland, and Tata Cater to sizable domestic demand in respective home markets.
Key players: Key players operating in the light commercial vehicle market are Daimler AG, Ford Motor Company, Renault SA, Ashok Leyland Ltd, VE Commercial Vehicles Limited, Tata Motors Ltd, SML Isuzu Limited, GM Group, Mahindra & Mahindra Ltd, Volkswagen AG, Toyota Motor Corporation and Stellantis NV. Most key players are focusing on developing electric LCVs and connected fleet solutions to comply with emission norms and capture growing market demand.
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it