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Truck market to drop 13% in 2016; 2017 to offer little reprieve – ITSA

Craig Uren

Craig Uren

26th May 2016

By: Irma Venter

Creamer Media Senior Deputy Editor

  

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The South African new-truck market will probably drop 13.2% in 2016, to 26 500 units, compared with 2015, says Isuzu Trucks South Africa (ITSA) COO Craig Uren.

Next year holds little promise for recovery, with the market currently forecast at around 27 500 units or less, he adds.

The 2015 market declined 3.3% compared with 2014, to 30 526 units.

The medium-commercial vehicle (MCV) segment is expected to drop 17.7% in 2016, to 8 600 units, with the heavy-commercial vehicle (HCV) segment to decline by 2.4%, to 5 500 units, and the extra-heavy-commercial vehicle (XHCV) by 14.4%, to 11 400 units.

The bus market is forecast to shrink by 13.2%, to 1 000 units.

Uren notes that MCV sales made up 30% of all new truck sales in South Africa for the first four months of the year, down from 35% for the full year in 2014.

HCV sales made up 20% of the market for the first four months, up from 17% in 2014, with XHCV sales at 46%, compared with a 44% share for the full 2014.

Pricing remains a challenge, adds Uren.

With the rand weakening around 30% against a number of currencies since December, truck manufacturers have only been able to recover “close to half of that” through price increases.

“How much more can the market take without demand being reduced? That is the tricky bit.”

ITSA has seen a drop in market share in the first four months of the year to 12.9% – excluding van and bus sales – down from 17.4% for the full 2015.

Uren says the South Africa truck bodybuilder market is also showing signs of strain, with three bodybuilders closing shop in Gauteng this year, and another in Cape Town.

ITSA has 138 bodybuilders on its books.

ITSA will introduce antilock braking systems on all of its 4x4 models in June, with all models to receive speed limiters by December, as required by legislation.

Uren believes the industry has not yet fully grasped the impact of the new legislation, which will limit trucks, depending on size, to top speeds of 80 km/h or 100 km/h.

Companies with a focus on express deliveries, such as parcels, may face efficiency challenges.

NEW CEO
Hiroaki Sugawara has been appointed as ITSA’s new CEO.

He takes over from Hiroshi Nishizaka, who has been in charge of the local arm of the Japanese company since 2012. Nishizaka will relocate to Australia.

Sugawara was previously a GM within Isuzu Trucks’ International Sales department, where he was in charge of West and South Asia, and the South Pacific area. In this capacity he also developed new markets for Isuzu Trucks in Iran and Uzbekistan.

 

Edited by Creamer Media Reporter

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