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UD Trucks Quon-EHCV-Range-Construction

SA Truck Market Gains Ground in 2014, Positive Outlook for 2015

13 January 2015 | Print

The South African truck market delivered a subdued performance during 2014, growing a modest 2.04% on 2013’s results, to conclude the year on 31 554 unit sales. 

This is according to the latest combined results for 2014 released by the National Association of Automobile Manufacturers of South Africa (Naamsa), Associated Motor Holdings (AMH) and Amalgamated Automobile Distributors (AAD).

“I think the local truck market still managed to deliver a satisfactory performance, especially if one takes all the macro- and socioeconomic challenges into consideration,” said Rory Schulz, managing director of UD Trucks Southern Africa. 

Looking at the year’s performance of the various market segments against that of 2013, Medium Commercial Vehicles (MCVS) declined by 4.86% to 11 021 units.  Meanwhile, the Heavy Commercial Vehicle (HCV) segment remained flat with a very slight 0.04% increase in sales to 5 476 units. 

The Extra Heavy Commercial Vehicle (EHCV) segment had a good run, with year-on-year sales increasing by 7.68% to a noticeable 13 804 units. 

“A recovery in the platinum mining sector and increased activities in heavy construction and long haulage were the main drivers of demand for extra heavy trucks,” explained Schulz. 

The star performer of the year turned out to be the Bus segment, with a significant 19.79% growth on its 2013 performance, logging 1 253 sales during 2014.  “The phasing in of Bus Rapid Transit units in metros like Tshwane and Cape Town contributed significantly to the increase in new bus sales,” said Schulz.

Mercedes-Benz remained the top selling commercial vehicle brand in South Africa, with a 16.35% share of the market (2013: 17.21%), followed by Isuzu with 12.84% (2013: 13%) and Hino with 12.77% (2013: 12.77%).

UD Trucks, in fourth position overall, managed to increase its market share from 9.96% in 2013 to 10.66% last year.  In terms of growth, UD Trucks increased overall sales by 9.29%, outperforming the 2.04% industry average.

In the MCV segment, UD Trucks managed to increase sales of its now discontinued U41 range by 3.96% to 657 units.  The last unit of this legendary range was produced in October 2014, with more than than 13 000 units sold since its introduction in 1996. 

UD Trucks was also once again the top-performing HCV range in the market, with a 23.94% market share.  The company’s best-performing segment was its Quon extra heavy range, which grew by a significant 24.9% compared to 7.68% for the total EHCV market.  This performance pushed UD Trucks to the fourth position in the segment, gaining ground from its 8.77% market share in 2013, to 10.12% in 2014.

During 2014, UD Trucks also continued to play a significant role in the export market.  The brand’s total sales in sub-Saharan Africa, excluding South Africa, increased by 44.68% to 544 units. 

“The year 2014 certainly was another noteworthy year for the UD Trucks brand in the country,” said Schulz.  “Over the last number of years, we have spent significant time and resources to ensure that we offer the right type of products for our local customers, backed by the professional support of our 65 region-wide dealers.  We believe that this renewed focus has been one of the reasons for our success in 2014.”

Outlook 2015

The forecast for the truck market remains positive for 2015, as some macroeconomic factors are beginning to show signs of improvement. 

The GDP is expected to increase slightly to 2.5%, a downward revision from previous forecasts, while some credit rating downgrades remain a concern.  Meanwhile the Gross Fixed Capital Formation (GFCF) index is set to decrease marginally as investment in construction and non-residential buildings decline –an indicator that there will be a decrease in demand for construction-related truck applications.

Inflation is expected to ease due to lower crude prices while no interest rate hikes are expected until the third quarter of the year.

“Exchange rates remain a problem for the industry, with the effects of ZAR weakness in 2013 and 2014 to be felt through higher than inflation product price increases in 2015 by all truck manufacturers,” said Schulz.  “We are also hoping that labour relations will be better after the prolonged industrial action in various segments throughout 2014.”

Forecasts for 2015 (Market analysis: UD Trucks)

Total Market

2013

Forecast 2014

Actual 2014

GROWTH

FORECAST 2015

GROWTH

BUS

1046

1050

1253

19.79%

1403

12%

MCV

11584

12200

11021

-4.86%

10911

-1%

HCV

5474

5800

5476

0.04%

5531

1%

EHCV

12820

13500

13804

7.68%

14356

4%

TOTAL

30924

32550

31554

2.04%

32201

2.05%

UD Trucks

2013

2014

GROWTH

FORECAST 2015

GROWTH

 

BUS

 

 

 

 

 

 

MCV

632

657

3.96%

 

 

 

HCV

1323

1311

-0.91%

1275

-3%

 

EHCV

1124

1397

24.29%

1430

2%

 

EXPORT

376

544

44.68%

490

-10%

 

UD Trucks in 2015

UD Trucks, part of the Volvo Group SA, will launch its new Quester range in March this year - the first of a new generation specifically developed for the world of extra heavy transport. It is derived from a combination of the company’s Japanese quality heritage and insights from the local market.   The Quester range will not replace the company’s current Quon range, but is expected to enhance its current product offering to the market.

“UD Trucks’ passion is to make fleet owners’ working day simpler and more productive, whether they are in long haulage, distribution, construction or mining.  Quester is expected to be UD’s most cost-efficient truck ever,” explained Schulz.  “The new range will cut fuel costs and maximise uptime, giving fleet owners quick dependable payback that will help them succeed in their business.”

The Group will also open a new multi-million parts distribution centre in Johannesburg during the first quarter of the year. 

“UD Trucks has a proud after-sales care record in the southern African region as a result of our concerted commitment to provide our customers with the best possible vehicle availability and utilisation,” said Schulz.  “As part of the world’s second largest commercial vehicle manufacturer, with its multitude of resources and technologies, the efficient and timely supply of quality UD Trucks parts remains one of our main priorities.”

The company is also continuously investing in the enhancement and expansion of the UD Trucks dealer network across the region.  

“With 65 franchised dealers already present all along the major routes and trade corridors in southern Africa, fleet owners are able to get complete support from UD Trucks, no matter where they operate in the region,” said Schulz.

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