Scania bucks bus and coach trend

While the bus and coach market has been decimated – not just here in South Africa but all over the world – 2021 has been a success story for Scania South Africa, as Marco Guedes, general manager bus & coach, tells CHARLEEN CLARKE.

While the pandemic has affected life in general, the impact on transport has been massive. “As we know, the Covid-19 pandemic has had a negative impact on the global movement of people – from air travel to road passenger transport. There’s been no exception in the southern African market, putting the medium to long-distance coach operator as well as our luxury tourism market under severe pressure – to say the least,” notes Guedes.

The consequences have been extreme. “All in all, the bus and coach industry in southern Africa has been reduced to half of what it was a few years ago,” he says.

One of the reasons for this situation is the decline in ridership figures (here in South Africa and also in countries around the globe). “On the whole, our industry was reduced to transporting only 50% of the prescribed carrying capacity at the beginning of the pandemic. Later this increased to 70%. Only recently have the operators been allowed to resume normal 100% carrying capacity services.”

As Guedes notes, this has been tough. “As most business owners, entrepreneurs and professionals would know, this is hardly a sustainable model. But this unfortunately is what our customers have had to endure. Social distancing and people’s lives are the priority during these unprecedented times, and we all have a responsibility to ensure we protect our fellow human beings and loved ones first and foremost. It doesn’t make it easier to keep a business afloat, though,” he points out.

While the situation in the market in general is dire, Guedes reveals that Scania has had a remarkably good 2021. “At Scania South Africa, we are humbled by our loyal customer base and are proud to say that, even in tough circumstances, they have continued to support us. This shows in the figures; we are leading the market – with the most coaches sold this year. This is a true testament to our customers; without them, we would not be where we are today!”

While things have been tough, according to recent research, the global bus and coach market is expected to grow from $76,7 billion in 2020 to $87,46 billion in 2021 at a compound annual growth rate of 14%. Are we likely to see similar growth in SA?

Guedes believes that this is possible. “If one looks to the NAAMSA figures for 2020 and 2021, coming off the very low base of these years, we could very well see compounded growth figures as mentioned in this research.

“Using this example: just from 2020 to 2021, the bus and coach industry grew 9% to date, year on year, and Scania bus and coach grew 70% in the same period whilst tripling our previous market share figure.”

Understanding every cog that turns in the operators’ businesses is what has allowed Scania to break into new fleets. “I’m delighted to report that we’re conquering new customers while still servicing our loyal customer base and tailoring unique financial solutions for the discerning business owner. All the while, we’re doing sustainable win/win business. This includes an 80% market penetration in our repair and maintenance contracts business.

“We’re coming from a very low base, so any improvement will be seen in good positive numbers. It also shows us how badly our market was affected by this pandemic in the first place,” he notes.

While the market was indeed badly affected, Guedes is hoping that it will pick up towards the end of this year – albeit slightly. “To date, our market has averaged 57 to 58 units per month. Typically the latter part of the year tends to show more promise than the first couple of quarters, so I’d say we’re on track to close at around the 680 to 720 unit mark – which is a far cry from the 1 200 to 1 400 unit market we’ve seen in previous years.”

And next year? “Pragmatic is the word that comes to mind. I don’t think we should be expecting a doubling of market size next year unless we have an unexpected big project that more than one OEM can cope with. An increase in market size of about 6 to 8% is what most manufacturers are anticipating,” he says.

So, another tough year. But it seems as though the bus and coach team at Scania is ready to handle whatever you throw at them…