Saturday 25 May 2019

Truck market declines again

The UK’s new truck market fell by over four per cent last year – the second consecutive year of decline. While demand for tractors remained relatively stable (and the 4x2s used primarily by FMCG distributors saw a useful boost) and made up 44.5 per cent of the market, rigid trucks of under 16 tonnes fell sharply driving the rigid sector down 6.7 per cent.

There was some growth within the rigid sector though, with demand for tippers, skip-loaders and flatbeds all increasing.

Turning to the fortunes of the individual manufacturers, it seems that market-leader DAF has taken much of the pain, with a fall in numbers of almost 12 per cent. However, the Paccar subsidiary remains comfortably ahead of second-place Mercedes, while third place Scania has made up some ground with its now complete new truck range.

Volvo Trucks did well to enjoy modest growth, but the big mid-table news comes from MAN which has put its past mechanical woes well and truly behind it, and powered past Iveco into a strong fifth place. Renault Trucks remains stuck firmly to the bottom of the mainstream manufacturers’ table.

In summary: DAF has taken most of the sting of a declining market for the other makers, being particularly impacted by falling demand for run-of-the mill rigids. MAN has taken deals off Iveco, and Isuzu Truck from Daimler’s Fuso subsidiary.

So, what might this year hold?

The manufacturers will note that the UK’s second year of decline comes in the face of an increase in demand for trucks from the rest of Europe, and that Brexit uncertainty is still present even as right-hand drive production allocations for the year are being decided for truck factories all across Europe. If UK demand for new trucks does recover, who will be there to meet it?

Some manufacturers have told Transport Operator that their UK order books for this year are already full, or nearly so, but they have been less forthcoming about the size of the books!

The only potential winners from a no-deal scenario would be DAF: WTO rules dictate lower tariffs on imported components that finished vehicles. But, if Brexit put the British economy into a prolonged tailspin, would it even be worth keeping DAF’s Leyland assembly plant open?

Previous recessions have seen manufacturers such as Volvo and Iveco retrench by closing their UK plants – and given the recent fate of Honda’s Swindon factory, in the current climate it can only be said that nothing is set in stone… or even bricks and mortar.

On the figures’ release by the Society of Motor Manufacturers & Traders (SMMT) in February, its chief executive Mike Hawes commented: “Despite the natural fluctuation in fleet buying cycles, the second consecutive annual fall in new HGV registrations is a significant concern.

“Business confidence is absolutely critical if companies are to invest in the latest, low-emission trucks in 2019, and with ongoing political and economic uncertainty and fewer than 50 days until we leave the European Union, we need stability now more than ever.”

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