Construction World February 2019

MARKETPLACE

SUCCESSFULLY CHANGING MINDSETS It is a tough time for South African construction. There is huge political uncertainty caused by, amongst others, land redistribution - while 2019 is also an election year. The private sector has adopted a wait- and-see approach, while the civil engineering sector is at historical lows. The result? A significant drop in the sale of new construction vehicles. Despite this Scania South Africa has maintained its market share in this segment, while other significant players lost ground because various value brands entered the market. This is a clear indication that the programmes that Scania introduced to enable it to offer Solutions Based Offerings over the last two years, are paying off.

An uncertain playing field According to the Construction Industry Development Board (cidb) SME Business Conditions report for the last quarter of 2018, the Building Sector continues to suffer from a shortage of work. Civil Engineering, even though it showed an increase from an all-time low of 27 points (out of 100) in Q3 of 2018 to 35 points, had the indicator measuring construction activity at the lowest level on record.

having built-up vehicles in stock to accommodate the construction industry’s fast turnaround times, agreements with preferred body builders that could assist with shortening lead times, financing and maintenance options, this market share more than doubled in 2017.” Even though the total South Africa Truck market grew with 9,1% in 2018, the construction sector had a significant decrease of 26,5%. The fact that Scania maintained its market share proves that Scania is building a sustainable business. “The NAAMSA statistics reveal that because of the uncertainty in the market, smaller construction companies have been forced to buy value brands as they want to stretch their capex,” says Friberg. “This is evident from the many smaller entrants into the construction vehicle segment.” He says that this will only be until the market ticks up. “Companies know that uptime and reliability is vital for their revenue generating ability.” Theuns Naude, Segment Manager: Construction, Public and Special Segments adds: “People are also holding on to assets longer and not replacing them at the normal frequency. The positive of this is that many trucks will need to be replaced at about the same time when the market conditions improve.” “Continuing what we started” Despite the significant drop of truck sales in the construction sector, Scania maintained its market share with only a marginal drop. “This is proof that the work that we have started doing, is paying off. And in the years to come, this pay-off will be even better,” says Friberg “Two years ago Scania was not really in the construction market

This obviously has a direct impact on OEMs. According to NAAMSA statistics, sales in the

construction vehicle segment fell by a dramatic 26,5% in 2018. Scania maintained its market share. Anders Friberg, GM: Vehicle Sales & Export says this is proof that the programmes

launched by Scania in the preceding two years are paying off. “In 2016 Scania had

a small market share in this sector – just

Anders Friberg, Scania GM: Vehicle Sales & Export says that even though the truck market had a significant decline, the fact that Scania held on to its marketshare is proof that what it started is paying dividends.

more than 3%. However, with programmes that include segment support,

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CONSTRUCTION WORLD FEBRUARY 2019