Brexit 'won’t hold back' Volvo Trucks

Volvo Trucks increased sales in 2016 for the second consecutive year and expects further growth this year, despite the economic uncertainty caused by the UK leaving the EU.

The company sold 20,000 units between 2009 and 2013, but now it predicts the five-year rolling period from 2013 to 2017 will see 30,000 vehicles registered in the UK and Ireland. 

Growth has largely come from increased rigid sales due to an increased demand for construction vehicles.

Mike Corcoran, commercial director for Volvo Trucks in the UK and Ireland, said: “Our share of the 10-26 tonnes market was up by 66% compared to the previous two-year period, helped by the Volvo FL entry into the 10-tonne sector and considerable interest in Tridem configurations of multi-wheelers.”

The company’s long-term ambition is to achieve a 20% share of the UK heavy duty market and sees further development of rigid sales as key to securing this ambition. 

“We feel pretty upbeat about 2017 but expect the market to be down by around 10%, but we’re not lowering our market share expectations. We expect growth in the sales of our distribution vehicles, such as FL, FE and FM, plus construction vehicles.

“Moving forward, we cannot but notice that a lot of emphasis has recently been levied on the effect of ‘Brexit’ on the truck business. Like a lot of companies, we have not seen an effect of Brexit on truck sales or aftermarket. 

“Growth forecast for the UK has just been upgraded to 2% in 2017 and OECD upgraded to 1.8%.  Our order intake for the start of 2017 is strong and we’re feeling pretty optimistic about the Truck Market in 2017, supported by a lot of infrastructure projects such as HS2,” said Corcoran.

In 2017 Volvo Trucks will bring a nine-tonne front axle and a 350PS engine on the Volvo FE which will enhance its suitability to other operations.

The company is also working to develop a Liquified Natrual Gas (LNG) engine which will offer significantly reduced CO2 emissions and lower fuel costs.

Ian Comer, head of product management for Volvo Trucks, said: “It’s a big investment for our customers as the infrastructure isn’t quite there yet but for those willing to invest in on-site refuelling for LNG, they will reap significant benefits from the new engine.” 

This year will also see the launch of ‘Check & Drive’, a new app which allows drivers to do their daily checks and will be linked to the brands Service Point Online offering and Compliance Contract offer. 

Service contract sales continued to show strong performance for Volvo Trucks in 2016: Three-year contract penetration has grown from 40% in 2014 to 56% in 2016 with an ambition of 60% in 2017. 

Corcoran said: “Used trucks contract hire is a key part of this and we are grateful to have a fantastic used truck business to support this. Today we typically sell around 30% of our sales on some form of residual value or buyback which means our used truck department has to deal with in the region of 2,000 returns per annum in addition to part exchanges.”

In 2016, the company sold more than 2,100 used trucks.  

“We have a long established used truck retail business across our dealer network and aim to retail as many used trucks as we can to keep the rolling population as high as possible in the UK and Ireland,” added Corcoran. 

“Our wholly-owned Used Truck Centre business is the largest franchised used truck dealer in Europe with multiple sites across the UK with up to 300 vehicles in stock at any one time.”