Global Growth on the Horizon For the Commercial Vehicle Industry

July 16, 2010

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The global trucking industry has a very bright future and has started to show some positive signs of a recovery across several international markets, said Matthias Wissmann, president of the German Association of the Automotive Industry
During a recent lecture, Matthias Wissmann, president of the German Association of the Automotive Industry, gave his thoughts on the global commercial truck recovery. (Photo by IAA)
During a recent lecture, Matthias Wissmann, president of the German Association of the Automotive Industry, gave his thoughts on the global commercial truck recovery. (Photo by IAA)
, during a recent lecture.

Europe accounts for more than 72 percent of the total volume of freight transport, and trucking's share of the transportation market isn't going to change any time soon, Wissmann emphasized.

"The times when the various modes of transport wanted to snatch market shares away from one another are past," he said. "Today they try to find joint solutions for enhancing growth and prosperity."

Wissmann gave his insights to attendees at a recent lecture, aimed at preparing them for the upcoming 63rd IAA Commercial Vehicles event in Hannover, Germany, Sept. 23-30.

Industry Growth

According to Wissmann, the freight recovery will be reflective of the overall global economy, and as demand grows, so will freight. Forecasters believe global economic growth for this year should be up 4 percent, he said. Emerging economies will see the most growth.

Road freight transport also has good long-term prospects, with some impressive growth rates already showing up in the first quarter of this year, he said.

"Forecasts for the year as a whole in Germany, for example, assume an increase in road freight transport of over 6 percent, and in the coming year the volume we could reach the volume we had in 2008."

China also holds a positive outlook in terms of the commercial vehicle market. While its market share was less than 30 percent in the heavy vehicle segment in 2008, its share should be up to over 40 percent this year.

The Western markets are characterized by a recovery this year, as well, with the U.S. truck business up and growth of 11 percent expected this year. In Brazil, sales have increased by more than half, he said.

German Truck Market

Germany is also on the road to recovery, with the number of new registrations up 4 percent this year. Exports of commercial vehicles from Germany have risen by 57 percent in 2010.

Wissmann said he expects the domestic market to jump to 64,000 units this year, a 5 percent growth.

"However, we are still a long way from the level we enjoyed in 2008, that is, 98,200 units," he said.

Manufacturers in Germany have boosted their domestic production. This year, 158,400 vehicles have rolled off the assembly lines, a rise of 41 percent. Their foreign production sites are expanding, with 50 percent or more growth.

While trailer manufacturers were hit badly by the recession, with sales down 80 percent, this year they've seen a boost in orders from domestic customers. This year should see sales of over 40,000, a 12 percent increase.

A Caution

But Wissmann emphasized that the global economic crisis was deep, and it will be a long road ahead to get back to the levels we were once at. In 2009, he said, sales fell to half their previous levels, even for major manufacturers. For some, sales even slipped 80 percent.

"You do not have to be an expert accountant to understand just how hard such drastic falls affect the companies," he said.

And the crisis is not over, he said. For 2010, production volumes in Western Europe, North America and Japan will be 30 to 40 percent lower than 2008 levels.

Wissmann offered some positive encouragement, however:

"Against this background, it is impressive to see how the companies in the commercial vehicle industry have held up in the face of the hurricane that swept through the markets - and I don't mean solely the German manufacturers but also our friends in all the other commercial vehicle producing countries, and the suppliers too."

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