LCV industry set fair for growth

Date: Thursday, December 17, 2015   |   Author: James Dallas

Prospects look bright as business confidence drives up sales. James Dallas looks at what’s in store for 2016 from product launches to legislation


 

With light commercial vehicle sales up 16.3% in the first 10 months of the year to 312,369 units, according to the SMMT, the sector looks to be in fine fettle as we head towards 2016.

Increasing business confidence has helped to fuel this growth as the economic recession recedes in the rear view mirror and van sales have also received a significant boost from the explosion in online shopping and its attendant requirement for more delivery vehicles – a trend that is bound to gather even more pace going forward.

Mike Hawes, chief executive of the SMMT, says: “The rise in demand for vans demonstrates an ongoing trend as more consumers choose the convenience of home delivery.” The SMMT forecasts sales of 375,000 for 2015, up 16.5%, and expects further growth of 2.7% in 2016 to 385.000 units before a marginal increase of 0.4% in 2017. The well-established recovery in the new van market is also starting to see stability return to the used sector, with the resumption of seasonal trends. With prices no longer driven up by the shortage of supply coming into auction halls values are likely to undergo a gentle softening over the coming months. But, barring any periods of unforeseen financial uncertainty, Jayson Whittington, CV valuations manager for Glass’s Guide,  predicts a healthy used market for 2016. “There should be a consistent level of retail demand for used units for the foreseeable future,” he says. “This, in turn should lead to a consistent level of demand from within the trade, which is just as well bearing in mind that volumes of used units that are predicted to enter the market are likely to increase still further throughout 2016 and beyond.”

 

Show time

The biggest event in the UK’s commercial vehicle calendar in 2016 will once more be the Commercial Vehicle Show that will, as usual, take place at Birmingham’s NEC - next year from the 26 to 28 April. The event has gone from strength to strength in recent years – after being cancelled in 2009 in the dark days of the recession. In 2016 the organisers are expecting 20,000 business-oriented visitors to come through the doors. Speculation will mount as to which manufacturers will reveal major new models in Birmingham but perhaps 2016 could see the return of Volkswagen with its next generation Crafter, which is being assembled at VW’s newly built plant in Wrzesnia, Poland. The manufacturer has not taken a stand at the show since debuting the last update to its (then Mercedes Sprinter-based) large van in 2011. Next year the CV Show will have to compete with the bi-annual IAA Commercial Vehicle Show in Hanover, Europe’s largest commercial vehicle event, in attracting major exhibitors. The Hanover exhibition takes place from 22 to 29 September. June (7-9) will see the launch of the Automechanika component and supply chain show. Also taking place at the NEC, the event is a joint venture between the SMMT and Messe Frankfurt and will aim to enable aftermarket firms to attract new business domestically and from overseas.

 

Trucking on

With so many models lining up to come to market 2016 is shaping up to be the year of the pick-up truck. A pair of stalwarts, Mitsubishi and Nissan, with their respective new L200 and Navara trucks, have already joined the fray but both brands are to spawn products for new sector entrants in the near future. Renault is to launch a Navara-based pick-up towards the end of 2016, having already revealed the vehicle as the Alaskan concept. More news should emerge next year of Mercedes’ debut pick-up as well, which is also based on the Navara and will go on sale before 2020. Meanwhile, Fiat Professional has revealed pictures of its own debut pick- up model, the Fullback, which is based on the new Mitsubishi L200 and will go on sale in the autumn. Ford’s facelifted Ranger will appear in the new year and Toyota has a new Hilux in the pipeline for next year too.

 

Sixth sense

September 2016 will see the Euro6 emissions legislation become

mandatory for light commercial vehicles. This will require operators to top up their diesel vans with urea-based Adblue to keep them within legal limits. If they fail to do so the vehicles could go into limp mode or fail to start. A potential irritant for operators is that Adblue top up schedules do not necessarily coincide with service intervals so may necessitate additional visits to workshops or, more likely require van drivers to top up their vehicles at home or in the workplace.

Euro6 LCVs will inevitably have a price premium over Euro5 versions so showrooms could potentially be busy with operators snapping up the older models before it’s too late, although this could be offset by the threat of stricter congestion charge zones.

Another trend likely to continue into 2016 is growth in the leasing sector as operators choose to rent rather than buy their vans to avoid the depreciation risks of purchase and sidestep maintaining fleets of vans during quiet periods.

 

 

 

 

 

 

 

 



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