Sales mixed for first third of 2016

Strong start to the year for Light and Medium trucks, Vans stall, while Heavy truck sales continue to wain

The latest Truck industry Council data shows that the first third of calendar year 2016 (January to April) has seen some patchy results for new heavy vehicle sales, possibly reflecting some consumer and business hesitation at the start of a federal election year.

The April results were typical of the inconsistent sales that we have seen thus far in 2016, with strong sales recorded for the month in Light and Medium trucks, Vans had their second successive month of negative growth, while Heavy truck sales were in positive territory, just, for a second month this year.

Total heavy vehicle sales year-to-date April 2016 were 9297 units, up 3.2 per cent or 292 vehicles, over the same period in 2015, however 18 per cent, or 2046 vehicles, short of the pre-GFC first third of year high of 11,343 sales in 2008. As we saw last year, the growth in the market in 2016 has come from the lighter segments with Light and Medium Duty trucks sales up over the first four months of 2016, Van sales are lineball with 2015 results, while Heavy Truck sales continue to be in decline.

Taking a look at each segment individually for the month of April as well as the first third of the year. The Heavy Duty truck segment was up slightly in April with a total of 744 units delivered, an increase of 0.9 per cent, or seven trucks, over April 2015. The first third of year result however shows the true state of the Heavy segment with sales year-to-date down 4.6 per cent (-127 trucks) over the same period last year, which was down a significant 12.6 per cent (-400 trucks) over the first four months of 2014.

The Medium Duty segment (8,001kg to 12,000kg GVM trucks) has posted modest growth in 2016 and this trend continued in April with the segment recording a total of 551 sales for the month, up 15.5 per cent (74 trucks) over April 2015. Year-to date the Medium Duty sales tally stands at 1923 units, an increase over 2015 sales of 102 trucks, or 5.6 per cent.

Light Duty (those trucks between 3,500kg and 8,000kg GVM) sales have been the star performer for the first four months of 2016, following on from great sales in 2015 and April was another very strong month for the small end of the truck market. 837 trucks were delivered for the month, up 21.7 per cent (149 trucks) over April 2015. For the first third of year, Light Duty sales are ahead of the same period last year by 11.4 per cent, or 309 trucks.

Growth in the strongest performing segment last year, Light Duty Vans, has cooled somewhat in the first part of 2016. For the month of April Light Duty Vans (those Vans with a GVM between 3,500 kg and 8,000 kg) saw just 390 sales, down 20.1 per cent (-98 vans) over the month of April in 2015. Year-to-date the story is a little more positive with Van sales tracking at about the same rate as last year, 1,710 sales in 2016 verses 1,702 sales for the same period in 2015. This is a slight increase of 0.5 of a per cent, or an additional eight vans.

President of TIC the peak industry body for truck manufacturers and importers into Australia, Phil Taylor, said that he was generally happy with the sales result to the end of April 2016. "It is encouraging to see that the Light and Medium segments of the heavy vehicle market doing well, with sales in both segments tracking ahead of those of 2015, while Van sales are sitting about where they were last year. I do, however, remain concerned at the continued slow sales in the Heavy Duty segment. Perhaps we will see this pick up after the federal election, as the purchase of a Heavy truck involves a greater financial outlay and businesses may be waiting for the next four years of political direction before committing to such investments," Mr Taylor concluded.

TIC Chief Executive Officer, Tony McMullan, reflected on the patchy sales results that have been seen thus far in 2016: "Light Duty truck sales have been the one constant over the first four months of 2016 with sales in each of the first four months up over those seen in 2015," he said.

"The Medium truck segment has seen three positive sales months and one negative and continues to place ahead of 2015.

"Light Duty Van sales appear to be cooling with two positive and two negative months. Year-to-date Van sales align closely with those of 2015.

"Heavy Duty truck sales continue to decline in 2016 with the two negative month sales outweighing the two positive month sales. I concur with the comments made by the TIC’s President that it appears companies are simply delaying their bigger dollar fleet replacement decisions, hopefully only until our country’s political path is determined in the pending federal election," Mr McMullan concluded.

Sales mixed for first third of 2016

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