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Truck group expects most sales growth to occur outside SA in 2013

2nd August 2013

By: Irma Venter

Creamer Media Senior Deputy Editor

  

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The Volvo Trucks group, which incorporates three truck brands, namely UD Trucks, Volvo Trucks and Renault Trucks, aims to sell just over 6 000 trucks in 18 markets in Southern Africa in 2013, says Volvo Trucks Southern Africa regional president Torbjörn Christensson.

“We see most of the growth happening outside South Africa. The South African market will either remain fairly flat or show some small gains.”

The Volvo Trucks group sold 5 612 trucks in Southern Africa in 2012, which gave the group a 20.1% market share in South Africa’s heavy-duty market, and 18.3% in the total South African truck market.

About 15% of its total regional sales, or around 900 units, will come from outside South Africa in 2013, up from 10% in 2012, says Christensson.

Eventually, the group hopes to increase sales outside South Africa to 30% of total sales.

Part of this growth will come from expanding the group’s footprint in Southern Africa.

While UD Trucks Southern Africa is represented in all 18 countries the group targets, Renault is only available in five, and Volvo in eight.

A

review, which should be completed by year-end, is being conducted to plot a course for the expansion of all the brands in Southern Africa.

The group also wants to grow its footprint inside South Africa.

Christensson regards UD Trucks’ 42 dealerships and service points as sufficient, but would like to increase Renault’s and Volvo’s 16-point network to between 22 and 24 within the next 24 months.

“We especially need to include Volvo and Renault service points in remote areas.”

He emphasises that the three brands’ dealerships and assembly plants will not merge in South Africa, with only back-office functionalities being aggregated.

Another reason for the expan-sion of the Volvo Trucks group in Southern Africa is the healthy growth of a number of economies, such as Mozambique and Kenya.

Truck customers in South Africa currently appear more hesitant to enter the market than elsewhere in Southern Africa, as there are probably “more clouds on the horizon here”.

These clouds include labour unrest, a volatile market, low busi- ness confidence and the uncer-tainty elections bring.

However, it is not all bad news, as South Africa still has a “large transport demand”.

“If customers do not want to buy new trucks, they must still replace, so we still see a lot of activity in the marketplace,” says Christensson.

He adds that the group’s numbers will most certainly be boosted in 2014 with the launch of a new range of trucks from Renault, as well as the roll-out of the new Volvo FH, FM and FMX ranges in the first quarter. UD Trucks is also set to expand its range next year.

The Volvo Trucks group currently holds around 25% market share in South Africa’s heavy-duty market, with UD Trucks also present in the light- and medium-duty truck market.

Edited by Martin Zhuwakinyu
Creamer Media Magazine Managing Editor

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