Light Commercial Vehicle and Medium & High-duty Truck Market Outlook, 2025

Robust Sales in Emerging Markets Mitigate the Effects of the Degrowth in North America and Europe

The global commercial vehicle market witnessed a decline in sales volumes in 2024, more so in the medium and heavy-duty truck segments than in light commercial vehicles (LCVs). Various regional markets had an oversupply, leading to a fall in truck demand. ASEAN, China, and India experienced a significant decline in LCV sales volumes, following strong growth in recent years. Poor demand for commercial vehicles in rural areas and lower consumption in urban areas due to businesses implementing cost-cutting measures amid unstable global macroeconomics were the leading contributors. In addition, high interest rates, rising geopolitical tensions, and excess supply all led to growing uncertainty. This dampened business sentiment and resulted in muted demand for trucks. Any incremental purchases or even truck replacements at the fleet end were put on hold.

Counter-tariffs from countries in response to the imposition of tariffs by the United States have made the global economy, trade, and logistics unpredictable in 2025. This is expected to have a significant impact on the overall freight movement and the cost of raw materials, goods, and components, affecting vehicle demand.

Apart from Mexico, most countries have limited exposure to US trade. Given the stance of the new US administration, the Environmental Protection Agency’s Phase 3 greenhouse gas regulations are expected to be diluted or pushed back by a few years. This is expected to result in a setback to the sales of electrified commercial vehicles. Europe, too, with a slowdown in electric vehicle (EV) investments and difficulty in achieving previously set targets, is expected to push back some of its existing EV-related targets by at least a couple of years.

However, India, ASEAN, and Latin America are projected to sustain growth in commercial vehicle sales in 2025. Stronger macroeconomics, improving business sentiments, and the revival of consumption are likely to be the major drivers of growth.

The study period is 2024-2025, with 2024 as the base year and 2025 as the forecast period. The geographic scope is North America, Latin America, Europe, India, ASEAN, and China.