Big moves for Scania SA in 2019

Scania South Africa (SA) ended 2018 with its biggest deal ever! And there are yet more exciting developments coming in 2019…

Scania SA ended 2018 by signing a 600-unit deal with Reinhardt Transport – the first 290 of which were delivered before the year was out.

However, success such as this does not come without much behind-the-scenes legwork and focusing on the most important aspect of any business: the customer. Anders Friberg, GM of vehicle sales and exports at Scania SA, knows this all too well.

“Operators were under pressure again in 2018. The fuel price hit them hard and impacted on cash flow. Big operators that would normally outsource to smaller operators began to concentrate on their in-house operations.

“Further, the construction segment dropped by 27 percent year to date, and mining also receded because of the mining charter.

“Keeping trucks on the road has, therefore, been a big challenge for us and our customers – uptime is so important to the customer and we have had to support them through many different initiatives,” he explains.

One of these has been the creation of a new mobile platform for the sales team. The sales portal allows for the input of operational data about a customer’s business, to create a truck that is the right spec for their individual needs.

“We have simplified our way of selling,” says Friberg. “The system has taken away a lot of admin work and, importantly, given our sales team 20 percent more facetime with customers.”

Friberg notes that the system has received widespread customer acceptance and future iterations will include more of Scania SA’s services – all with the aim of increasing customer uptime.

Other initiatives have included the on-site servicing of trucks, where Scania’s own technicians, tooling and parts are placed at the customers’ premises. Service hours at its biggest facilities have also been extended to allow for night-time work.

“We are listening to our customers and adapting,” Friberg notes. This is something that he says will become even more important in 2019.

“Just as business confidence grew with “Ramaphoria” in 2018 (and there was some investment in transport), we hope that the 2019 elections will stimulate the segment in the same way,” comments Friberg, cautioning that a slowdown in certain sectors should nevertheless be expected.

“We believe the market will drop by between five and seven percent next year, due to the usual uncertainty that surrounds elections. There will be possibilities, but only after the elections.”

This is not holding the company back, though, as it is currently gearing up for a very important, very exciting launch…

Coming to South Africa this year will be Scania’s New Truck Generation (NTG). “This is no secret anymore,” laughs Friberg. “We have even taken some encouraging customer orders already.

“We naturally expect sales to slow slightly (the company ended 2018 with an overall market share of 15 percent) with the transition from the old model range to the new – but we will still have run-out stock of the old vehicles with which to support our customers. We will also bridge that period using our various internal solutions, to ensure customers stay on the road until the NTG arrives at dealers,” Friberg says.

The new range will also allow the company to continue making headway in the mining and construction segments.

“We currently have 5,5-percent market share in construction. There is still a big portion of that market to conquer, but we understand that mining and construction customers are different to those in long haul, which is why our segment support managers work with these customers to maximise their total cost of ownership and revenue. Our 40-t, 8×4 heavy mining tipper has proved itself in terms of payload, average speed and turnaround times, as well as uptime,” he says.

Naturally, solutions such as after-hours, on-site and mobile servicing; driver training; as well as tracking and telematics solutions all aid customer productivity in these segments.

The company’s used-vehicle and bus divisions also performed well in 2018. Friberg explains that in the used-vehicle sphere, the company has realised the need for the same services it offers to new-vehicle buyers.

“In August 2018, we started selling repair and maintenance contracts with our used vehicles. We also offer a finance solution (roughly 40 percent of used vehicles are now sold this way). We don’t only sell a truck, and these services give the buyer confidence in our products and services,” Friberg says. In 2019, he expects trade-ins to tick up to about 1 300 units, or 65 percent (from 50 percent in 2018).

While Scania Bus remained stable in 2018 (with 22 percent market share), there are some exciting developments on the cards for 2019. “Sustainability is a trend in the bus market, it’s going green more quickly than the truck market,” Friberg explains.

“We have big bus customers testing biofuel buses and we’re currently concluding a project to assess the possibilities of buses powered by compressed natural gas (CNG) in South Africa. By mid-year we will be able to offer a range of alternative-fuel solutions to the South African bus market,” he says excitedly.

With so much activity coming up, Friberg and the Scania SA team are aware that they will still need to keep one eye on their customers. However, if there’s one thing the Reinhardt deal proved, it’s that Scania SA knows how to focus on its customers.