CUSTOMER SEGMENTATION

The transition of CVs to BSVI may have been unkind to transporters in the wake of the prevailing market situation, at least in the short term. But for value trucks, it is an opportunity to get better; to drive closer to the efficient and technologically efficient trucks of Europe. Value trucks, since their advent a few years ago, have been fairly successful in getting some of the most price sensitive buyers to look beyond cowls and provide their drivers with basic creature comforts at the least. In segments like multi-axle tippers and long-haul tractors, value trucks have seen widespread and successful deployment and the customers have benefited from the advantages of a factory-built safety cabin from a view point of safety, comfort and productivity. Value trucks with factory-built cabins, is thus, on the rise. These also promise their buyers the ability to get down to business from day-one and to operate for longer duration (18 to 20 hours a day). While the BSVI truck prices are 10-15 per cent more than a BSIV truck, it is the improved fuel efficiency, reliability (more on-road time), durability and better TAT that drives more revenue-earning kilometres contributing to improved TCO and hence profitability. Value trucks, and it is no surprise, is rapidly gaining acceptance in growing segments like progressive logistics companies and e-commerce startups. Below (Exhibit C) is an overview of how customers are seeing value trucks as a key ingredient of their productivity. The way forward would be to offer such trucks on TCO terms, a sales methodology that is prevalent in the premium truck segment. It is a technique that premium CV players like Volvo and Scania has honed to their and their customers advantage.