February Truck Market Shows Encouraging Growth

The preliminary published February 2012 result for the South African market for commercial vehicles with Gross Vehicle Mass ratings of more than 3 500 kg, was still devoid of sales volumes from a substantial market participant, so it is not possible to draw direct comparisons with historical data that previously contained full reporting details from Mercedes-Benz South Africa.
This non-reporting manufacturer has provided only a globular February commercial vehicle sales total of 630 units, but this must be assumed to also include models from the Light Commercial Vehicle market (Gross Vehicle Mass Ratings below 3 500 kg), so this volume cannot be used to complete the record of the segments covered by this report.
A total sales volume of 1 851 units was units reported during February, 2012 by those members of the National Association of Automobile Manufacturers of South Africa (NAAMSA) who have elected to remain within the full reporting system.
The market composition was made up of 731 Medium Commercial Vehicles (GVM ratings between 3 501 kg and 8 500 kg), 395 Heavy Commercials (goods vehicles with GVM ratings between 8 501 kg and 16 500 kg), 652 Extra Heavy Commercials (goods vehicles with GVM ratings above 16 500 kg) and 73 passenger Buses with GVM ratings above 8 500 kg. (Please note that these volumes also include aggregated MCV sales recorded by Associated Motor Holdings and Amalgamated Automobile Distributors, which were made up exclusively of Hyundai-branded light truck models).
“Once again, it has been necessary to evaluate the performance of the truck market in February by comparing the latest result published by NAAMSA with data from earlier timeframes from which sales by Mercedes-Benz, its associated brands and other non-reporting manufacturers have been removed. Recognizing the potential distortions that such an analysis might produce, it is prudent to extend the latest review period to also include the January result, thus arriving at a year-to-date comparison for the purposes of this market comment,” says Dr. Casper Kruger, Vice President of Hino in South Africa.
“The resulting calculations reveal total year-on-year market growth of 8,1 per cent when compared to the equivalent first two month period of 2011. In the case of the individual segments, entry-level MCV sales improved by 2,3 per cent, cruiserweight HCV volumes by 17,2 per cent, the premium payload XHCV category by 6,1 per cent and passenger Busses by 52,2 per cent,” he adds.
The substantial improvement in HCV sales is particularly noteworthy, reflecting recent momentum recovery for the Japanese brands that dominate this category, following the reduction in product availability caused by the March 2011 tsunami/earthquake. The uptick in Bus sales is also welcome, as this category has retreated somewhat in the period following Soccer World Cup 2010, and is currently re-establishing a base for future growth.
Kruger adds,“The market growth evident in the above analysis confirms earlier predictions that the momentum gathered by the market during the latter months of 2011 would be sustained into the early months of 2012, while vehicle manufacturers and importers catch up with the unfilled orders that were placed during the latter months of 2011. However, the earlier uncertainty concerning prospects for the market beyond the first quarter of 2012 has been mitigated by the Minister of Finance’s announcement, during his annual Budget Speech, that infrastructure spending to the value of R83 billion has been provided for during the 2012/13 fiscal year.”
The nature of the resulting infrastructure projects, including road and dam construction, improvements to public transport, and housing development, should extend the term of the currently positive environment for commercial vehicle sales.
Kruger concludes: “The planned extension of this infrastructure programme by a further provision of R188 billion over the 2013-2015 period should also sustain the steadily growing trend in truck and bus sales for the medium term. The recent announcement of measures to promote local manufacture of buses through selective public sector tendering is also good news for the local bodybuilding industry, which has found itself seriously disadvantaged since the relaxation of importation restrictions in the mid-1990’s, and contracted substantially as a result. Despite continuing concern over high fuel prices, the local vehicle supply industry is currently operating in a favourable marketing environment, with improving business sentiment, a strong Rand, and the lowest interest rate scenario since the mid-1970’s. These factors combine to present a more positive outcome for trucks and buses during 2012 than may be the case for light vehicles, because of pressure on the disposable income of consumers”.

Truckstore Announces New Facility

TruckStore, the used commercial vehicle specialist from Mercedes-Benz South Africa, is ready to commence construction of a brand new facility for the Southern African market.
Preparing for the necessary earth works, and then commencement of construction, the TruckStore team is kicking-off with an official ground-breaking ceremony on site – Highway Business Park Centurion. TruckStore is a first for Mercedes-Benz South Africa and will soon become one of the largest used-vehicle dealers for commercial vehicles – vans, trucks, buses and trailers.
TruckStore sells vehicles of all brands, body configurations and ages. Conveniently situated off the N1, on 30 000m2 of prime real-estate, the facility will have ample parking for large vehicles and is well-situated in Gauteng, between the two major airports (OR Tambo and Lanseria) for the convenience of it’s clients.
TruckStore is one of the largest used commercial dealer networks in Europe and will now officially be launched to the Southern African marked by the middle of 2012. In the Daimler Group, TruckStore is responsible for the professional, international used truck business, involving trucks of all brands and ages, and with all body types.
TruckStore in Europe is growing constantly and already has 30 locations in 14 European countries and has a rolling stock of around 4 000 vehicles, selling more than 20 000 vehicles annually. TruckStore is a Daimler initiative, which began operations in 2002. This proven model concept has been adapted to suit the Southern African market.
TruckStore also accepts commercial vehicles of any vehicle type or brand in part exchange. The condition of every vehicle is thoroughly checked and assessed on the basis of uniform standards. Vehicles are then subdivided into the product categories gold, silver and bronze. This ensures that every vehicle delivers what is promised.
TruckStore will also have a dedicated reconditioning centre based at Zandfontein, which will also serve as the national return centre for our Finance House – Mercedes-Benz Financial Services. The preparation of the used commercial vehicles by dedicated technicians and service staff to bring these used commercial vehicles up to set standards, will be undertaken at the Zandfontein facility, ensuring that these vehicles meet TruckStore benchmark standards.
As part of the Mercedes-Benz South Africa commercial vehicle value chain, TruckStore customers will benefit from a range of services specifically for used commercial vehicles, such as finance, insurance and warranties. This TruckStore initiative will ensure significant growth in the used commercial vehicle segments and the close collaboration with the MBSA dealer network will be strengthened.
The TruckStore website at www.truckstore.co.za recently went live with full details for customers to familiarise themselves with the new and exciting TruckStore concept. Once the TruckStore facility is officially opened the website will be upgraded to an internet platform that will enable used- commercial vehicles customers to find their ideal vehicle even faster – a vehicle suited to their needs – thanks to easy navigation functions. The new functionality will be user-friendly with its clearly structured sections, simple controls and optimised contact functions. In addition to the new design, users will also benefit from a photographic gallery of the used commercial vehicles together with full specifications.
Construction work on the R20 million office building, which will house offices and display facilities, will commence shortly and is expected to be officially opened by mid-2012. Following numerous geometric tests, it was identified that the ground works require a significant amount of preparation due to the dolomite in the area.
A fair amount of excavation will take place – 15 000 cubic metres, which equates to 1 500 truck loads of earth – the area will be compacted and the earth returned to the site. Following these earthworks, construction will commence. The builders will be laying around 1.25 million paving blocks to complete the professional display area.
Consideration has been taken into the design of the building, which will be functional and environmentally friendly. Certain eco friendly measures will be put in place to retain the rainwater for irrigation and solar geysers are to be installed to minimise electricity costs.