Nigel Base – Society of Motor Manufacturers and Traders

The SMMT Commercial Vehicle Manager gives his view on the key issues affecting the UK commercial vehicle market

The UK’s new commercial vehicle markets continue to illustrate the contrasting recovery and growth paths playing-out across the country.  While high street shops struggle and government cutbacks bite, UK vehicle operators are displaying a confidence lacking in the wider economy.  There’s no short-term expectation of a return to the overheated growth of 2007 but a steady increase in registrations that should, in the coming years, see the market return to its long-term average.

SMMT registration data shows that tractor units and vans are leading the recovery.  Overall, truck volumes were up by a cumulative 7,937 for the nine months to the end of June: 94% of that is due to tractor unit sales.  For vans, although the numbers are different, the picture is very similar with registrations rising for 18 months in a row.  Van figures have recovered strongly from the depths of recession in late 2009 and early 2010.  This trend is reflected across most of Europe suggesting that the recovery could be sustainable.

However, when we dig a bit deeper into the numbers the picture becomes more mixed.  Registrations of rigids and heavy vans are flat at best.  This whole sector is actually nearly 2% lower than it was a year ago.  Any economic growth out of such a deep recession is bound to be patchy, even in good times the variation in demand between different sectors is complex and disjointed with, for example, big contrasts between the construction, freight and business services markets.

But what about the short to medium-term outlook?  The looming introduction of Euro VI for trucks and Euro IV in the London LEZ is bound to distort the market and in the longer-term the addition of more LEZ across the UK and the general introduction of more advanced, even lower carbon technology, will all influence the nature and frequency of vehicle acquisition.

It’s looking like 2011 will be the year electric vans establish their place in the ‘mainstream’ low weight sector and while numbers will inevitably take time to rise, they have arrived nonetheless.

The economic outlook remains uncertain, and the commercial vehicle landscape looks to be as challenging as ever.  Despite this, the underlying confidence of businesses and operators points towards a slow but steady recovery that will hopefully set the UK market in good stead for years to come.

Nigel Base is SMMT Commercial Vehicle Manager.  For further information, contact the Society of Motor Manufacturers and Traders Ltd (SMMT), 71 Great Peter Street, London SW1P 2BN.  Tel: +44 (0)20 7235 7000, Fax: +44 (0)7235 7112, web: www.smmt.co.uk

Published: 08/08/2011