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Volvo-Scania Monopoly Scare Downplayed

February 22, 2000

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The European Commission may be worried that Volvo's purchase of Scania will give the new group more than 90% of the Swedish truck market, but truck buyers say that if the merger brings steep prices they'll simply shop other manufacturers.

"It is a tradition in Sweden to buy Volvo or Scania," a consultant for the state-owned transport company Svelast told Reuters news service. "But if you can buy a truck at a cheaper price there is no doubt you would switch to another brand."
Other fleet executives seemed to agree, and balked at suggestions that special cab insulation required for the extreme Nordic winters is an obstacle to competitors.
"Other companies make other trucks for the cold," said a union official. "As long as you can get a good service network, you can buy them."
The two companies have offered to open their dealer and service networks to rival trucks but last week an EU commissioner said further concessions were needed before the deal could be approved. The deadline for additional proposals was February 21.

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