Truck  |  Investor Relations  |  Bus 

Strong May Sales for Trucks and Buses

Despite general market uncertainty due to debt crises in several Eurozone economies, heavy commercial vehicle buyers in South Africa are exhibiting relatively bullish procurement patterns in 2012, spurred by ongoing long-term investments by government in infrastructural development projects and favourable bank lending conditions.

According to Naamsa (National Association of Automobile Manufacturers of South Africa), “ongoing improvement in the financial position of consumers, historically low interest rates, continuing improvement in vehicle affordability in real terms, the highly competitive trading environment and new model introductions,” have contributed to sustained growth in new vehicle sales volumes in South Africa thus far this year.

“Continued growth in consumer expenditure and public sector infrastructural investment would also support domestic new vehicle sales. The recent sharp depreciation in the exchange rate was also likely to result in pre-emptive buying over the next few months as consumers sought to purchase vehicles to avoid the possible impact of the lower exchange rate on new vehicle prices,” Naamsa reports.

The prospects for continued growth in the heavy truck and bus sectors are good, adds Naamsa, with May 2012 volumes registering “a rise of 183 units or 12.7%, compared to the corresponding month last year. Most manufacturers in these sectors reported strong order books going forward.”

The only blemish on the registry in this segment for last month was the domestic sales volumes of heavy trucks, declining by 6% compared to May 2011 and registering a year-to-date drop of 1.2% domestically. Export sales volumes of heavy trucks however, grew by 200% in May 2012, compared to May 2011, while year-to-date performance in this export segment is up by 35.1% on 2011.

Sales volumes of extra-heavy trucks remain strong, Naamsa reports, with domestic unit sales rising by 21.6% on May 2011 and export sales up by 75% on the corresponding month last year. Year-to-date volumes are also positive with domestic volumes registering 11.6% growth and export sales up by 100% on the first five months of 2011 respectively.

Sales volumes of new heavy buses also posted strong growth statistics during May 2012 with domestic sales up by 8.6% and export unit sales rising by an impressive 325% on May 2011 respectively. Year-to-date figures in this segment are also positive with domestic volumes up by 11.6% and export sales registering 100% growth on the first five months of 2011 respectively, states Naamsa.

According to Bruce Dickson, deputy CEO, MAN Truck & Bus South Africa, “the operating environment for both truck and bus fleets is becoming increasingly competitive with rising fuel prices and fluctuating parts pricing placing increasing pressure on profit margins. As a result, fleet operators are buying new vehicles that are technologically well equipped to minimise fuel consumption and component wear. Furthermore, the ability to procure heavy commercial vehicles with extended warranties and fixed cost-per-kilometre service contracts are also strong buying criteria for commercial fleets seeking cost predictability and lowest possible total cost-of-ownership.”

The efforts of multinational organisations to limit the carbon footprint of their supply chains is also impacting positively on the sale of trucks and buses with low fuel consumption performance, says Dickson. “Apart from deploying vehicles with advanced diesel engine technologies, leading local truck fleets are introducing new aerodynamic truck and trailer combinations with significantly reduced rolling resistance and enhanced payload capabilities that help lower total operating costs while simultaneously limiting their environmental impact. Similarly, new extra-long passenger bus configurations are also being deployed by local operators, contributing to reduced carbon emissions, enhanced customer service and a reduction in traffic congestion.”