Semi Trucks

While the outlook for passenger vehicle sales remains bleak over the next 12 months, truck, van and bus sellers believe they can grow the record commercial vehicle sales achieved in 2007 even further. “There is still evidence of pent-up demand in the market,” says Nissan Diesel South Africa (NDSA) vice president of operations Rory Schulz. He says the distribution and construction sectors are still displaying a large appetite for new trucks. The South African truck market broke through the 37 000 unit barrier in 2007, recording its best sales performance ever.

According to the National Association of Automobile Manufacturers of South Africa, a total of 37 069 trucks, vans, and buses were sold during 2007, which is a 12% increase on 2006’s performance, and more than double the 16 327 units recorded in 2003. Schulz expects 2008 sales to reach 40 453 units. Despite the positive news, he warns that this figure does signal a slowdown in the growth rate achieved in the commercial vehicle sector over the last five years. He adds that South African demographics would suggest that the local truck market could even out at 45 000 units a year, but warns that this is a “very optimistic” assumption. He believes a more realistic view is a market stabilising at 30 000 to 40 000 units a year.

“It is unlikely that we’ll go down to 10 000 units a year again.”

NDSA managed to increase its market share from 12,4% in 2006, to 13,4% in 2007, recording 4 963 unit sales during the year. This is a 20,9% increase in sales when compared to the company’s 2006 results. In the process, NDSA moved into the third position in market share rankings, and now lies behind Mercedes-Benz (15,51%) and Toyota (14,17%). NDSA aims to sell 5 592 units during 2008, which will be an increase of 12,67% on 2007 results. Some of this growth is expected to flow from the launch of a new range of extra heavy trucks, the Quon, in March.

“Due to this, we expect another jump in 2008,” says NDSA CEO Hiroshi Yokofujita.

Another factor which could aid the company’s growth ambition is a R10,9-million investment in the expansion of production capacity at the Rosslyn plant. “As a result, we will be able to increase production from the current 4 500 units, to a possible 9 000 trucks per year,” says NDSA executive vice president of management control Johan Richards. The self-funded investment has been used to expand the truck-assembly line, as well as to install additional equipment, such as a so-called ‘chassis turn-over machine’. This machine ensures easier assembly, as it turns the chassis upside down during the early stages of production.

On a global front, NDSA has managed to retain its number one position as parent company Nissan Diesel’s top market outside Japan. Export markets such as South Africa will play a pivotal role in Nissan Diesel Japan’s aim to grow turnover by 20% over the next three years. The Japanese truck maker sold around 39 500 units last year, of which 25 500 were outside the Asian country.

By 2010, the company expects to to sell 51 382 units, with 35 000 units moving off showroom floors outside Japan.