The Indian government has mandated that all medium and heavy commercial vehicles (M&HCVs) must have air-conditioned (AC) cabins, effective June 8. This move is expected to increase vehicle costs by around 1.5%, according to Sanjeev Kumar, president and head of M&HCV at Ashok Leyland. However, Kumar believes that this price increase will not negatively impact demand, as the industry was well-prepared for the transition. Unlike previous changes in emission norms, there has been no pre-buying, and demand remains intact.
Ashok Leyland’s domestic MHCV truck sales have declined 5% year-on-year to 93,540 units in FY25, and the slowdown continued into the new fiscal with a 10% drop in April sales. Nevertheless, Kumar is optimistic about the benefits of AC cabins, which will improve driver productivity and efficiency. He notes that about 15-20% of the commercial vehicle industry has already adopted AC cabins, and this will enhance fleet performance on long-haul routes. With AC cabins, monthly vehicle utilization is expected to increase from 7,000-8,000 km to 15,000-20,000 km.
Ashok Leyland is currently producing AC-fitted trucks across its entire M&HCV range at all its facilities. Other manufacturers, such as Tata Motors, have also begun rolling out factory-fitted AC systems across their truck ranges. The government’s mandate applies to trucks with capacities between 7.5 tonnes and 55 tonnes, and the industry is adapting to the new regulation. Overall, while the introduction of AC cabins will increase costs, it is expected to have a positive impact on the industry, improving driver comfort and increasing vehicle utilization. The demand for M&HCVs is expected to remain strong, driven by the growing need for efficient and comfortable transportation solutions.