The June truck sales figures are in for the Truck Industry Council T-Mark survey and it confirms we are in the middle of a booming truck market. The numbers have been rising all year but now we can examine the half year and see just where the numbers are heading.
The overall number of trucks sold in the first six months of 2018 amount to 19,970 units. This suggests, if the second half of the year continues at this level, the total number of trucks sold in Australia could threaten the 40,000 mark for the first time.
These levels are unheard of and running much higher than recent years. From 2009 until 2016 the annual total hung around the 30,000 mark, with a low point of 27,858 in 2011. The drop in numbers followed the global financial crisis and the long term effects of the lower economic activity have continued until mid-2017 before showing a real upturn.
The second half of 2017 showed a strong market, but in 2018 the market has been going gangbusters with several brands breaking monthly records on the way. Isuzu sold 1059 trucks in June, a mark the Japanese importer has rarely, if ever, met through its nearly 30 years of market leadership.
Much of the growth in sales has come in the heavy duty sector of the market. Unfortunately, the numbers don’t let us drill down much further and tell us which part of the trucking industry is bowling on ahead the fastest.
One viewpoint looks back over the past ten years and sees how the sales numbers have been depressed for much of that time. If this lower level of buying on the part of the trucking industry has been delayed replacement of ageing trucks, then it is fair to assume operators will have to renew at a faster rate at some point to get back to lower maintenance costs from a newer fleet. That point may be now.
There is also an infrastructure boom in progress. Massive projects in Melbourne and Sydney, plus the continuing dualling of the Pacific Highway are just the big ticket items as road improvement schemes come on stream around the country. These kinds of project have a high demand for road transport throughout the construction phase, materials, equipment and prefabricated elements all need to be moved into and out of the site.
It would also appear the mining industry is starting to ramp up again, after quite a few years in the doldrums. Again these projects need road transport to supply them and, often, to get the product off site.
The universal trend is upwards overall. If you compare market share in the heavy duty segment many brands are about where they were when truck sales bottomed out earlier this decade. Kenworth remain around 20 per cent of heavy sales and number two, Volvo remain just under 15 per cent.
However, some more long term structural changes can be detected where some brands have shifted in market share terms, both up and down. One of these, Mercedes Benz have moved from a steady fourish percent in the past to a flourishing eight per cent since the launch of the latest range in the last two years.
Scania is another brand which has raised its game. Consistently at four per cent until 2013, the Scandinavian truck maker has made steady progress up to the eight per cent level. However, this year’s market share has dipped below seven per cent, but this is probably due to the introduction of an all new range and the supply problems this can create.
In contrast to the strong growth of European cabovers, there has been a decline in market share for some of the conventional North American brands. Both Western Star and Freightliner have seen market share slip from around seven or eight per cent ten years ago to around three per cent of the heavy duty market today.