Registration figures for the market above 3.5 tonnes in 2006, released by the SMMT show it was a roller coaster year.
Although the market was only down 5.6% compared to the previous year, the turbulence of the market, caused by, first digital tachos and then by the Euro-4 engine emissions legislation meant we saw some very sharp highs and lows. For instance, new vehicle registration for the month of April 2006 leapt to 10,751, up from 5110 the previous year and then subsequently fell every month until the Euro-4 peak in September 2006 when it shot up 35%. Since then the market dwindled every month to the end of the year - down 39% month on month in October, 23% in November and 28% in December.
At the beginning of January the press was treated to a 138-slide presentation - I know I counted them - from Iveco's managing director Chris Thorneycroft-Smith who gave a typically robust analysis of the data. Looking at both Iveco's performance and that of the competition.
Frankly, despite the spin he put on it, 2006 was a woeful year for Iveco with its registrations sliding 18.5% from 7864 registrations in 2005 to just 6409 in 2006, corresponding to an 11.5% share of the market. This is a far cry from the heady days of the early 90s when Iveco was comfortably commanding 20% of the market, indeed its performance slide was only beaten by ERF (down 42.9%), Foden (64.3%) and Seddon Atkinson (20.1%) and all three of those makes have been virtually retired.
Iveco's strategy here is quite simple, and indeed laudible: It will not mortgage the family silver for the sake of market share. It argues that the sort of discounting its rivals are doing to gain share is suicidal and it is not prepared to participate in this sort of marketing. This is good stuff, but the market is such that unless you are prepared to engage in these deals or your costs are low enough that you can play in this market and make money, then your performance will slide - as witnessed by Iveco. When pressed, Thorneycroft-Smith, said he wasn't going to stand by and let the share disappear to nothing and he indicated Iveco would be prepared to "sharpen its pencil" to retain volume if required. This news will come as a welcome relief to the Iveco dealer network which, we understand is a little concerned to see the volume slide, particularly as, over time, this will impact on the Iveco vehicle parc and could hit parts business.
Iveco weren't the only ones to suffer at the hands of the market. Volvo and Mercedes both saw double-digit declines in their market share, 12.2 and 10.3% respectively. Volvo was particularly badly hit in the medium distribution range, where the changeover from the old FL-E to the new, much-improved, line-up left a big gap in availability - this should be filled with the new arrival. Mercedes, like DAF and Iveco, both got badly hit in the 7.5-tonne sector. The market for 7.5-tonners dropped 11.3% as the demand from the rental and leasing sector eased following the digital tacho changeover and the three top performers all dropped sharper than the market itself. Mercedes also saw a drop in its tractor unit share.
On the plus side MAN, Hino and to a lesser extent Scania and Renault all showed market improvement in 2006 compared to the previous 12 months. MAN's performance, up 19.4% was a significant leap on the previous year and signs that MAN is finally getting back to the sort of position it was in before it got lumbered with ERF. Hino showed the biggest increase in sales we can remember with a massive 1295% increase and an end of year market share of 7% in the eight-wheeler market. That's a little behind the 10% share of eight-wheelers it wanted at the start of 2006, but is a big improvement and indicates the potential the company has.
Renault Trucks showed a 3% increase in registrations in 2006, while Scania saw sales climb 1.4%, both companies increased share in a falling market and were particularly successful in the tractor market.