UD Service Agreements drive uptime, predictability and cost control

According to Pravesh Bhima, general manager: service agreements at UD Trucks Southern Africa (UDTSA), structured maintenance solutions are a strategic necessity for today’s fleet operators.

Given the pressure to keep vehicles on the road for longer while containing operating costs, it’s little wonder UDTSA has seen a sharp rise in the uptake of its service agreements. Contract penetration reached 50% in 2024 – meaning one in every two trucks sold now leaves the dealership with a maintenance plan in place. This growth, says Bhima, reflects a shift in how customers view maintenance: it’s no longer a reactive expense, but rather a proactive business enabler.

“What truly motivates me every day stems from my core belief in being customer centric,” he adds. “Knowing that our service agreements directly contribute to the smooth operation of our customers’ businesses and minimise disruptions is a significant driver for me.”

Meeting real-world operating needs

Designing effective service agreements requires a careful balance between customer realities and OEM standards. “Designing effective service agreements requires a multifaceted approach,” Bhima explains. “We consider customer needs and operational requirements, UD maintenance standards, competitive pricing, ongoing data analysis and continuous improvement.”

At a practical level, pricing is driven by the cost of genuine UD parts, UD Genuine Lubricants and competitive labour rates, as well as application, truck model, and contract duration and type. This structured approach enables customers to lock in predictable monthly costs alongside protecting vehicle realibility, uptime and long-term resale value.

While UDTSA currently offers two main service agreement options, additional contract types are being actively explored as customers’ operational requirements continue to evolve. “Our goal is to provide a broader, more flexible range of service solutions that align with different applications, usage patterns and customer expectations,” notes Bhima. “By considering the full spectrum of customer needs, we aim to expand our portfolio and introduce more tailored agreement options going forward.”

At present, UD Trust Standard focuses on preventative maintenance aligned to OEM service schedules – covering inspections, lubricants and essential parts to detect issues early. UD Trust Ultimate builds on this with broader repair coverage for major components such as the engine, driveline and transmission, together with 24/7 towing support – providing customers with enhanced peace of mind and uptime protection.

Predictable costs, measurable performance

A key driver behind the recent growth in service agreement uptake has been UDTSA’s focus on long-term contracts. “To enhance aftermarket absorption and foster long-term customer relationships, we actively promote and activate five-year UD Trust Ultimate contracts,” says Bhima, listing benefits like improved customer retention, stronger dealer profitability and a better overall customer experience.

Recent innovations have also contributed to this momentum. A joint financial contribution from the OEM and dealer network has enabled a significant price reduction on Ultimate contracts, directly contributing to the 50% penetration milestone.

Performance is closely monitored through a range of KPIs, including contract penetration, customer retention, uptime comparisons between service agreement and non-service agreement customers, and dealer feedback. This data-driven approach also ensures the plans remain competitive in a changing market. “Our key strategies include ongoing parts pricing reviews, strategic evaluation of service interval extensions and robust budget curve management,” Bhima explains. By continuously updating cost forecasts with real-world service data, the business is able to maintain market-related pricing while safeguarding reliability and service quality.

Common customer objections around cost and control are addressed by demonstrating transparent cost structures, reduced downtime, access to factory-trained technicians and the financial planning benefits of fixed monthly payments.

Looking ahead, Bhima expects service agreements to evolve towards predictive, performance-based models supported by telematics, AI-driven scheduling and digital platforms – all aligned with the company’s “Better Life” purpose and its commitment to long-life partnerships.

In an industry where uptime directly impacts revenue, UDTSA’s service agreements continue to prove their value as a powerful cost control and risk management solution for fleet operators.