TFR’s aggressive stand will impact extra-heavy truck sector

The truck industry faces
some critical challenges
in the years ahead ranging
from volatile currency
movements to the
government’s intention to
move more cargo by rail,
according to UD Trucks
Southern Africa (UDTSA).
While factors such as
these may not necessarily
decrease the sale of
trucks, they will definitely
impact on the different
market segments, and
expectations are that the
dynamics within segments
will change drastically
in the coming years, says
the company’s GM for
corporate planning and
marketing, Rory Schulz.
“The move from road
to rail for instance will
see the softening of extraheavy
truck sales as more
commodities are moved by
rail,” he said. “At the same
time though it will increase
sales in other truck sectors
as the bulk will still have
to be broken down and
moved by truck in certain
areas. We don’t think the
tonnage moved by truck
will change, but rather the
type of truck moving it
will change,” he told FTW.
The move from road to
rail will, however, start
becoming a reality sooner
rather than later and
expectations are that the
extra-heavy truck market
will begin to feel the
impact this year.
“Transnet has just
announced the procurement
of 143 new locomotives
as well as its intention to
build a new railway line
through Swaziland, and
these are all factors that
could start impacting on
the sales in the extraheavy
commercial vehicle
market,” said Schulz. “Lots
of minerals are transported
by extra-heavy trucks. We
will see this impact, slowly
but surely, as these projects
are rolled out.”
He said Transnet was
without doubt more
aggressive in its intentions
to get more commodities
on rail than ever before.
“We are also watching
the implementation of
the e-tolling system in
Gauteng very carefully.
While the entire process
has been put on hold, it
will be implemented at
some time and will have an
impact on us.”
According to UDTSA
CEO, Johan Richards,
external influences, like
the Eurozone crisis, are
also continuing to have a
negative impact on local
growth, including job
creation, exports and as a
consequence, truck sales.
The volatile currency
due to many investors
moving their money out
of South Africa was also
a concern as it had a
major impact on pricing
of trucks, while global
political insecurity
continued to impact on the
price of fuel as oil supply
and its pricing remained
contentious.