THE DEFINITIVE TRUCKING SITE

February 2010

Energetic and positively committed to southern Africa’s road transport users are, from left: Ed Chvatal, Managing Director of Iveco South Africa; Raffaele Di Donfrancesco, Iveco’s Sales & Marketing General Manager for Africa, Middle East and Central Asia; and Eamonn Parker, Iveco’s Network and Marketing Manager, Southern Africa

According to NAAMSA figures, Iveco’s South African truck sales took a nasty dip in 2009. While the whole market took a 45% nosedive, Iveco’s picture looked more serious because of a change in their truck sales reporting procedure – instead of reporting sales to dealers they fell into step with the rest of the 2009 market and now report sales from the dealer network to customers. The consequent reporting delay resulted in perceived market share losses. Iveco is still OK, made a profit locally in a bad year and is strengthening its South African and African position writes Dave Scott.

Fiat Group is a current success story and Iveco is part of this. From near collapse, Fiat Group has revived itself under the helm of chief executive, Sergio Marchionne, to make a 2009 revenue of 50,1 billion Euros – in local currency at today’s rates that’s a stunning R531-billion – and a trading profit of 1,1 billion Euros in spite of the severe recession in major world markets.

This is, of course, down on 2008 trading profit figures at 3,4 billion Euros. In 2009, Fiat Group even bought Chrysler in the USA after Daimler walked away with huge losses. Is this a good move for Fiat? Only history and hindsight expertise will tell. Locally, Iveco has moved out of its low-profile Wadeville offices in Germiston to a Fiat Group head office in Midrand overlooking the N1.

Iveco knows Africa – they are active all over North and West Africa where CKD plants and longterm positioning provides 25% market shares for trucks over 16t gross vehicle mass (GVM). Although the Libyan market is small for heavy trucks – only around 950 per annum – Iveco has a market share in excess of 64%.

In world terms, Africa, Middle East and Central Asia accounts for 12% of total Iveco sales – so take heart that South African Iveco truck and bus operators are not insignificant in global terms, this in spite of official NAAMSA statistics. This has grown from only 5% so the trend is positive, as is the determination to grow the local market.

In the South African market segment, declines for 2009 over 2008 are significant with the bus sector flat-lining as it always has in the past.

But locally in buses, Iveco has shown a remarkable revival. Among suppliers to South Africa’s heavy bus market, Iveco appeared in the past as an ‘also-ran’ but in 2009 they have taken a firm 2nd slot with 315 units delivered and a 22% share of buses over 8,5t GVM. Iveco and their Irisbus brand mean business.

A brief visit in January 2010 from Raffaele Di Donfrancesco, Iveco’s Sales & Marketing General Manager for Africa, Middle East and Central Asia market, confirms that here’s a tough engineer who can adapt to the vast territory under his control.

Di Donfrancesco has customer contact in 80 countries and is convinced that success in the truck market is relationship driven. “And you have to be in the field with customers,” he says. This means that Di Donfrancesco’s 250 staffers have only 70 members sitting in the comfort of head office in Turin while 180 are based close to the action where the rubber meets the road.

What’s the outlook for 2010? Di Donfrancesco is pragmatic. “2010 will be a similar environment to 2009 and a transitory year,” he says.

In 2009, Iveco launched the very ‘green’ EcoDaily in Europe. We will not see these engines here yet as our fuel and emission legislation is only at Euro 2 level. The Daily van and chassis cab will, however, continue to arrive in SA with facelift items and the current power train. The Power Daily 4,2t and 5t GVM versions aimed especially at passenger transport, will be relaunched here in 2010.

Never mind Copenhagen, overall it’s all about being ‘green’ and wrapped up in Di Donfrancesco’s statement: “Sustainability is a way of life!”. We agree.

Like all successful executives at his level, Di Donfrancesco is focused on his people and Iveco’s customers. A wise observer of business strategy noted once: “A successful change of strategic direction has been accomplished only when your customer perceives and believes this, and tells you directly or indirectly, by using more of your services - not just goods. Only service reinforces loyalty.”

That’s what Iveco needs – a growing base of loyal customers where differentiating service is the challenge.