Home FleetWatch 2019 Fleets buy down as economy continues to struggle

Fleets buy down as economy continues to struggle

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Gert Swanepoel, MD of UD Trucks Southern Africa: “Customers are buying down into the smaller and less expensive vehicle segments.”
Gert Swanepoel, MD of UD Trucks Southern Africa: “Customers are buying down into the smaller and less expensive vehicle segments.”

Even though South Africa’s struggling economy is continuing to have an impact on the local commercial vehicle industry, the sector showed a 3.1% year-on-year growth in new unit sales as of the end of October.

According to the latest combined year-to-date results released by the National Association of Automobile Manufacturers of South Africa (Naamsa), Associated Motor Holdings (AMH) and Amalgamated Automobile Distributors (AAD), a total of 23 190 new trucks and buses have been sold so far in 2019.  

Compared to the ten-month sales statistics of 2019, sales in the Medium Commercial Vehicle (MCV) sector have increased by a significant 12.0% to 7 270 units. Heavy Commercial Vehicle (HCV) sales dropped by 7.7% during the same timeframe to 4 190 units. Extra Heavy Commercial (EHCV) sales continued to climb with 11 039 sales so far this year – a 4.6% increase over 2018’s statistics. Bus sales remained in the negative, with only 691 units sold this year, a significant 23% decline.

“For the past few months we have seen a certain buying pattern emerge among fleet owners in the truck market. With MCVs continuing their double-digit growth and HCVs on the other hand declining by around 7%, it is a clear indication to us that customers are buying down into the smaller and less expensive vehicle segments. This is largely due to the prevailing challenging economic conditions in the country,” says Gert Swanepoel, managing director of UD Trucks Southern Africa, adding that growth in the EHCV segment continues on the back of the bulk movement of goods and commodities.  

“Perhaps there is an underlying sense of resilience, which would be the positive takeaway from this. Or perhaps we should be on our toes and ensure we prepare for some tougher trading months ahead,” he cautioned.

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