From strength to strength
Scania South Africa is in a very good place at the moment. GAVIN MYERS sat with six members of the company’s management team to get the details from the horse’s mouth.
Twenty percent: That’s how much Scania grew its South African market share during 2014. By anybody’s standards, that’s an achievement not to be scoffed at. The team is unashamedly proud, and is looking forward to more to come this year.
“Last year was excellent for Scania, both locally and globally,” says Steve Wager, MD Scania Southern Africa. “We remain in a dominant position in neighbouring countries and we are particularly pleased with our growth in Namibia and Botswana.” (Scania Southern Africa also operates in Zimbabwe, Mozambique, Malawi, Zambia and Tanzania.)
Over the last two years, the company has increased its share of the South African extra-heavy market by 50 percent. There have been numerous drivers behind this growth. “The foundation for this success is our regional structure that we implemented in 2013. Dividing the country up into five regions brings us far closer to our customers and permits quicker decision-making. You cannot manage South Africa from Johannesburg; decentralisation is essential,” Wager notes.
Steen Gram, service director at Scania SA, adds that the company has succeeded in becoming a service solutions provider. Petr Novotny, MD for Scania Finance and Insurance, explains: “We offer a complete solution in order to tailor-make a package that will minimise total cost of ownership, by providing the best transport solutions and the best value to facilitate greater income.”
Minimising total operating costs is central to the company’s future outlook, and is something it takes very seriously. The company will focus heavily on this in 2015. “It’s about getting costs into perspective,” adds Alexander Taftman, product and marketing director.
The scope of the company’s transport solutions (and the value they add) is clearly hitting the right notes with customers. The regional structure was the first step in this journey, but the company’s range of vehicle- and service-related solutions has continued to grow unabated. The sales, service, finance and insurance, rental and used-vehicles operations will continue to evolve during 2015.
Patrik Glas Crommert, CFO and Scania Rentals, is quick to explain that the relatively new rental operation is an important part of the company’s total transport solution offering. “The great thing about rentals is that it offers absolute flexibility. It is a plug-and-play solution that allows customers to focus on their core business instead of worrying about repair costs and residual values, while we take care of the maintenance for them. It’s a win-win solution.
“Rentals are not just for transporters who have short-term transport needs, or customers who need a truck and don’t have the means to buy one. It can be used to cut seasonal peaks or bridge the gap between trade-ins. We’ve expanded our range offering to include truck tractors and bodied rigids. We’ll continue to expand it into new segments, depending on demand. We look at any request and see how to find a solution for it.”
Closely aligned to the rental operation (all rental vehicles are also for sale) is Scania Used Vehicles. The Scania approach is to consider used vehicles as part of the core business rather than a necessary evil.
“There are customers who have transport operations that are not suitable for new vehicles; they won’t even look at them. Whether you buy a new or used vehicle from Scania, the package offered is the same … from insurance, finance and fleet management services, to service contracts. The full back-up is there and the promise is the same,” explains Wager.
Looking at its service offerings for 2015, Scania’s customers can expect big things from the finance and insurance department (Novotny is mum at the moment, but he assures us that something significant is on the horizon) and with regard to fleet management solutions.
Says Gram: “During 2014, we created a new department called Scania Connected Services. This is not limited to fleet management systems; it’s so much more. It encompasses the services tied to fleet management and how to best utilise the data gathered to bring out new services that add even more value for the customers.”
Gram also notes that the company’s service network will be strengthened and the company will continue to focus on customer requirements.
Sales director, Ivan Stefanovic, picks up on the point of meeting customer requirements. “We want to be able to provide the best transport solution for the customer and his business. We focus on supplying the right product for the right application and operation. This doesn’t only mean for trucks, but also for our complete range of buses and coaches.
“While we can meet every bus application, the product that stands out most is the Touring. We provide a true one-stop shop for all service requirements. The Touring was also our first bus to come standard with a complete fleet management system – as on our trucks. From January this was also made a standard feature on all the bus chassis we bring in.”
Taftman adds that, during 2014, Scania appointed a key account manager for sustainability and sustainable transport solutions: Anthony King, who is affectionately referred to by his colleagues as “Mr Green”. (We interviewed him in the August 2014 issue.) “The issue is so much greater than just alternative fuels. Mr Green has expertise in different types of alternative fuels as well as sustainable transport solutions, and, although the local fuel quality isn’t an issue with our vehicles, we are taking a lead role in bringing this technology to market.”
(Wager is adamant that South Africa is ready for vehicles with more advanced emissions ratings, and points out that the company has a number of customers successfully operating Euro-5 vehicles on standard 50 to 500 ppm diesel.)
Nonetheless, with the extra-heavy long-haul segment accounting for 70 percent of the local market, this will remain a core focus for Scania. Taftman hints at something to come in the mining and construction sectors as well: “These segments show a lot of potential because of the harsh conditions in which these vehicles operate. The service and support demands are on a different level from those of on-road transport. That makes it challenging, but it also creates a great opportunity for Scania.”
And discovering new opportunities is never a bad thing. “We suspect that the market is now at the level where it has peaked and the strong growth will begin to level out. We don’t see any strong indicators of market growth to come,” Wager says sombrely.
Of course, this won’t deter the men and their nationwide team. They’re ready to tackle any challenges 2015 might throw at them.