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Prime Mover Magazine

Truck heavyweights to set market pace in 2017

A grouped analysis of heavy-duty truck sales in 2016 reveals just how tight the leadership race between PACCAR Australia and Volvo Group Australia really is – and that only four major players dominate some 70 per cent of the market.

With 16 brands competing and the prospect of International re-joining the mix as part of Iveco in 2017, Australia’s 10,000-unit-strong heavy-duty truck market is regularly used as an example for over-population.

Yet, with various OEMs now being managed centrally as part of multi-brand organisations, the majority of sales are actually made by four major players only – PACCAR Australia, Daimler Truck & Bus, Volvo Group Australia (VGA) and the Penske Corporation.

Referencing the Truck Industry Council’s (TIC) tally for 2016, Prime Mover’s Senior Feature Writer, Peter Shields, found that market dynamics shift slightly when consolidating last year’s sales data.

“Overall the heavy-duty sector had a stable year with 9,882 units sold, which was just 12 less than for 2015,” he said. “What’s interesting is the dynamic that has developed between multi-brand conglomerates, especially PACCAR Australia and Volvo Group Australia (VGA).”

Shields found that more than 70 per cent of the heavy-duty trucks sold in Australia during 2016 were sourced from the four major groups, followed by the big truck offerings from the likes of Isuzu, which sold 1,278 units during 2016. Single brand Scania sold 745 heavy-duty trucks last year, and Iveco 542.

“VGA, comprising Volvo, Mack and UD Trucks, sold a combined 2,722 trucks and increased its market share to 27.5 per cent, which would make it the largest group in the Australian heavy-duty market,” Shields found.

“That’s 127 extra trucks and a 1.3 per cent market share increase. 119 of those extra vehicles were Volvos, which increased that brand’s market share from 14.9 per cent to 16.1 per cent, while Mack managed an extra nine trucks for the year.”

The PACCAR group, meanwhile, sold the same number of heavy-duty DAFs in 2016 as it did in 2015 – 285 – while the flagship Kenworth brand came up with 35 fewer sales for the year, leading to the group’s market share being reduced by just 0.3 per cent to 23.2 per cent.

“The Daimler Truck group should be pleased with its 2016 heavy-duty results, with only Freightliner not improving sales – it missed by just one truck. However, the big American still sold the most trucks for the group, with 567 new units, followed by Mercedes-Benz (432 units – an increase of 24.8 per cent over the previous year) and Fuso (396 units – 15 trucks more than in 2015). The combined result for the Daimler group of 1,395 was 100 units more than in 2015 and allowed the group to take an extra 1.0 per cent of market share, increasing to 13.1 per cent.”

Heavy-duty results at the Penske Group were not as bright as the others, Shields summarised, with only MAN increasing its sales in the category (224 units vs 210 in 2015).  At 334 trucks, Western Star was down a disappointing 167 trucks, while waste industry niche provider Dennis Eagle only managed 25 deliveries compared with the 86 it achieved in 2015.

“Overall, the Penske Group sold 214 less trucks with a total of 583 across its three brands and as a group had its market share decrease by 2.2 per cent to sit at 5.9 per cent at the end of December.”

Shields commented, “When sales are tight and the overall market is flat, it is market share that becomes a major driver in such a competitive environment, which is why many OEMs revert to a group perspective.

“While such a move can create economies of scale, in some instances specification options make trucks almost indistinguishable from the competition – and the challenge of differentiation for the OEMs and their dealers becomes similar to that faced by fuel companies trying to market identical products mostly at very similar prices.”

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