Scania Link Customer Newsletter Issue 1 December 2016

THE SCANIA

LINK

THE NEWSLETTER FOR CLIENTS OF SCANIA SOUTHERN AFRICA issue 1 | December 2016

Beating the challenge Welcome to the end-of-year edition of The Scania Link – the Scania publication that lets you, our customer, into all aspects of the world of Scania Southern Africa. In this issue, we highlight some of the year’s activities.

Our business is one that focuses on working with customers and delivering a total solutions package – from financing to aftersales support and all the services in between.

At Scania, we talk about the total operating economy of the customer – not only costs, but also the uptime and possibilities to earn. We have designed a good service network to support uptime, and the fact that we offer a one-stop shop is important to our customers.

All this is made even more important by the tough trading conditions currently slowing business across all industry sectors. While 2015 was a “boom” year for Scania in the truck, bus and genset segments, 2016 has proved to be a much tougher nut to crack overall.

I do, however, believe that very good opportunities and possibilities exist in the southern African region, despite the need to first overcome a few economic and political hurdles.

It is our job at Scania to make the task of running a business easier for all our customers, and therefore their customers – whether in tough or prosperous times. We are not perturbed by the challenge, and this edition will highlight all the ways in which we are making this possible.

I trust that you will enjoy the journey through this edition of The Scania Link, and will continue down the road with us as we endeavour to increasingly build on our total solutions promise.

Raimo Lehtiö MD, Scania South Africa

Scania South Africa is poised to support its customers’ growth, says Lehtiö.

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Scania Total Solutions

At your service The services department at Scania South Africa is responsible for providing head office support to the retail operation.

In order to make satisfying its customers’ needs a reality, this portfolio incorporates: technical training; driver training; repair and maintenance, or services; fleet management contracts; warranty; and Scania assistance…

Says Theunes van der Westhuizen, area manager: Service Operations: “Our focus has been to be flexible in creating and supporting these initiatives.”

For example, Scania Connected Services was established in September 2014. This was in line with the company’s vision to have every single vehicle connected with its on-board fleet management system by 2020.

“Each vehicle that has come off the line since September 2014 has been connected to our fleet management system. This adds a lot more value to the customer, because we can identify whether the vehicle is being used optimally,” explains Van der Westhuizen.

The Scania Fleet Management System is the heart of Scania Connected Services and, with the top-line Control package, a simple RFID tag can be used to track which driver is driving a vehicle and whether they need additional training.

Scania Contracted Services is a major portfolio within the services department. The idea is to be able to support the retail arm with flexible, tailormade repair and maintenance solutions to suit each customer’s needs – no matter the vehicle or market segment.

“We work hand in hand with the dealer network from the back office view of supporting the warranty, driver training, technical aspects and so on, to establish what we can do and what it’ll cost.

We have to be close to the customers to ensure we offer and deliver the right support,” says Van der Westhuizen.

This strategy is clearly working. Customer take up of Scania Services has seen a year-on-year growth rate of 18 to 20 percent.

Fleet management and so much more In September 2014, Scania South Africa introduced the Scania Fleet Management System (FMS) as standard fitment on new trucks.

Within two years, just over 4 000 Scania vehicles have been connected to the system.

“Scania FMS is ideal for all business owners who wish to maximise the uptime potential of their fleet,” begins Faried Arnold, connected and driver services manager at Scania South Africa.

The overall goal is to provide accurate, reliable and userfriendly information quickly – while efficiently assisting with queries.

Monitoring is the basic package. It sends the operator weekly, monthly and yearly reports, via email. The package shows, at a glance, how each vehicle is performing and which ones require special attention – without the need to wade through data.

The Scania Fleet Management portal can also be accessed. Fault reports can be combined with planned maintenance and sent as a work order to the workshop.

The service planning function provides an overview of all the equipment in a fleet, along with maintenance plans and

a calendar to keep track of maintenance and repairs.

At the other end of the scale is the Control package; an advanced set of services for fleet owners who also want to support their transport process with operational information.

The popular Control package allows fleet managers access to traffic-light, fuel, exception and environmental reports. It also displays live fleet position information and tracking and allows geofencing perimeters to be set.

“Both packages are integrated with the Scania Fleet Management app, while the Scania Messaging Service effectively complements our Control package. This extra service offers quick and easy communication across your workforce through instant messaging. For further peace of mind, the system also offers traceability and safe storage of historical communication,” Arnold adds.

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“Our solution must mirror the operator’s needs.”

ON THE MONEY Regardless of the focus of a business, Petr Novotny, managing director Scania Finance, is confident that Scania Finance can ease the financial process. and one invoice at the end of “The Scania approach is to every month. The results are provide the customer with a full less administration and saving solution, with the main benefit time. simply being that of cost,” he Novotny says this agility is explains. “Our solution must only enabled through the crossmirror the operator’s needs functional cooperation between exactly: we try to match the the Scania sales, after-sales, cost with his revenue stream, finance, insurance and usedkeeping affordability and vehicle departments. financial stability in mind.”

In the last 18 months, Scania It begins with an understanding of the customer’s finance has increased its penetration from 40 to 60 needs – the type of vehicle, percent. “Our customers see its specification and the area it as a contribution to their in which it operates – and business,” Novotny says. “If expectations. difficult times come, we can help “We look at each operation our customers make difficult differently and also try to decisions and find the best understand its specific risks.

The solution can be customised solutions.”

An increased footprint helps for each client, because in this regard, with the Scania our definition of risk is not Finance organisation predefined,” says fully based in Namibia, Novotny.

Botswana, Zambia, There is a spinTanzania and Kenya (and off advantage, looking at Mozambique too – convenience. and Zimbabwe as well).

One relationship, “We’ve changed from whether it’s with the Our a ‘banking’ way of doing salesman, financial customers business to a proactive representative, or a see it as a cooperation with the more senior person contribution customer. The main within the Scania to their focus for us is on the organisation, means customer,” he reiterates. one point of contact, business

Scania Truck Rental: a totalsolutions package Patrik Glas-Crommert, Scania CFO overseeing the rental division, says that Scania Truck Rental offers a full-service solution based on customers’ business needs. “Our fully maintained rentals provide the perfect opportunity for operators to free up cash flow without long-term commitment, or risks.”

According to Nicola Engelbrecht, national manager at Scania Truck Rental, the total-solutions package comes with full maintenance, comprehensive insurance and additional options, such as driver training from the Scania Driver Training Academy.

Truck rental periods range from one week to 12 months.

Competitively priced, flexible, tailormade solutions are also available – enabling customers to predict their costs upfront.

“We provide the vehicle and the service back up, while the customer adds a driver and gets a predictable monthly bill. It is a plug-and-play solution that enables us to maximise the customer’s overall profitability,” says Glas-Crommert.

The Scania rental fleet comprises mainly low-mileage trucks, adaptable across many applications, which are no older than three years. Scania Truck Rental can be obtained nationally through the Johannesburg head office, Durban and Cape Town rental offices, or through Scania’s countrywide dealerships.

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alternative fuels

It’s time for Africa!

Scania is proving that “going green” is most certainly attainable in South Africa!

According to Mark Templeton, key account manager for alternative fuels at Scania South Africa, a greener country will start with driver training: “A well-trained driver can cut a fuel bill by 15 percent in South Africa, if not more.

That means a reduction in emissions too,” says Templeton.

Next up is a focus on public transport. “We need to move people away from cars and into efficient public transport – such as bus rapid transit (BRT) systems. Ideally, those buses should be powered by ethanol, or other biofuels, so that we can dramatically improve sustainability, mobility, lower the carbon footprint, and improve the health of people in cities,” he says.

Templeton aims to convert the bulk of the fleet on our roads to vehicles powered by alternative fuels. “We already have three alternative-fuel engines in South Africa: a ninelitre, 201 kW (270 hp) bioethanol engine; a 201 or 231 kW (270 or 310 hp) biogas engine, which can also run on compressed natural gas (CNG); and all Scania’s Euro-5 engines, which are approved to run on 100-percent biodiesel with slight modifications,” he says.

According to Templeton, the adoption of sustainable energy sources isn’t just good for the environment. “The employment potential of the global biofuel industry is significant. Africa needs jobs,” he points out.

Waste water, organic waste and food waste could commercially be turned into clean biogas and ethanol right here in South Africa. “Scania and our partners can supply the whole turnkey solution. We’re doing it in India, there is no reason why we cannot do it here,” he says.

Sweden now recycles 90 percent of its waste, and Templeton would love to see the same thing happening in South Africa. “The sewage and organic waste (for example, food waste) from 1 000 citizens could generate enough biogas to power a city bus for one year,” he says.

Even though operators are not incentivised to go greener, Templeton says there is a definite mind shift taking place in the South African transport industry, especially the bus industry.

“Clients are asking for alternative fuels.

Scania is also receiving requests for vehicles running on alternative fuel from the waste management segment,” he says.

However, more industry players need to step up and embrace a green future. “Will going green benefit our country? Yes. Does our industry need it? Yes. Does our continent need this? Yes. Does our planet need it? Absolutely.

So, let’s all contribute positively and leave behind a green legacy,” Templeton urges.

Infrastructure gets the GREEN light Fuelling environmentally friendly vehicles is no longer an insurmountable challenge in South Africa – because Scania is working hand-in-hand with a number of innovative companies!

One of these is Tetra4, a subsidiary of Renergen.

According to Stefano Marani, CEO of Tetra4, the company harvests its onshore natural gas in the Free State. “Our current production capacity is the equivalent of up to 40 000 litres of diesel a day, and we want to increase this level,” he says.

Tetra4’s gas is biogenic in origin, meaning it is created by bacteria living very far below the surface. “This is a natural process, and results in a high-quality, methane-rich gas that can be deployed directly into vehicles capable of running on compressed natural gas (CNG).

“Running a vehicle on CNG could reduce carbon emissions by as much as 20 percent (compared to a vehicle running on traditional fossil fuels),” he says.

The environment is not the only winner: “CNG is

sold at a lower price than petrol and diesel. There will also be savings that result from the newly implemented emissions tax, as well as the upcoming carbon tax.

“The South African government has also introduced additional tax incentives such as section 12L EE of the Income Tax Act, which results in further tax incentives,” Marani explains.

Ethanol is another fuel that is readily available in South Africa. Silversands Ethanol planted the first commercial sugar beet crop in South Africa that was designed for use in the manufacture of bioethanol back in April 2009. The first ethanol bus trial took place in 2010.

Scania has been running a bus on sugar beetderived ethanol in Cape Town for a number of years. It has proved to be extremely successful, and the CO2 savings amount to 78 percent (versus regular diesel). In future, a contender could be sugar cane – a crop that grows very well in the Durban region – which offers CO2 savings of up to 90 percent.

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scania customers

Scania Test & Drive: what a success!

Recently, Scania invited 400 customers from around southern Africa to its Test & Drive event at Gerotek – allowing them to experience the vehicles for themselves.

Customers were able to take the wheel on four tracks to gauge driver and vehicle performance on a range of criteria: speed oval (fuel and

drives, including interlinks and rigids, buses and a Touring coach, construction and mining units, alternative fuel vehicles (refuse collectors) and distribution units (including a high payload 8x2 vehicle). Nine different trailers were on offer, along with 10 different bodies.

Horsepower on tap ranged from 360 to 620 hp.

Above left: A wide range of vehicles was on offer.

Above right: The Henred team (the company supplied many of the trailers) with Scania’s Faried Arnold.

ergonomics – long haul vehicles, interlinks, coach, bus), ride and handling (regional, construction and mining vehicles), straight track (manoeuvrability – distribution vehicles) and skidpan (alternative fuel vehicles).

A comprehensive range of vehicles was on hand for test

As well as test driving vehicles, participants had the opportunity to take part in live demonstrations. Aquaplaning on the skidpan with a Gerotek driver at the wheel appeared, from the outside, to be a nerveracking undertaking but proved a sedate affair inside the Scania cab.

Participants had the opportunity to test drive vehicles and take part in live demonstrations

The track experience was supplemented by an additional eye-catching vehicle display that included two gems from Scania’s used vehicle portfolio, including a rare special edition Black Amber R580. Interior display space was devoted to the range of Scania services.

“Scania has expanded its footprint and offering tremendously. Never before have we offered such a broad range of products and services,” says Raimo Lehtiö, Scania South Africa MD. In today’s competitive environment, it’s important to be as flexible as possible, as product and marketing GM at Scania South Africa, Alexander Taftman, points out. “Our customers are the experts on logistics – we’re the experts on providing a complete solution.

We have all the building blocks.

Customers can select exactly what they require in a solution.”

Placing demonstration units in fleets is standard practice in the industry. Scania’s reintroduction of its Test & Drive event elevates the concept to a different level, reinforcing the company’s assertion that it’s not about the vehicles – it’s about the complete transport solution.

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Scania Customers

Ngululu joins the Scania family Ngululu Bulk Carriers, one of South Africa’s largest black-owned, heavyduty trucking operations, recently acquired 97 new Scania G460 trucktractors. The deal forms part of the fleet replacement strategy of the 335rig Ngululu Bulk Carriers fleet.

With its main depot in Steelpoort, Limpopo, Ngululu Bulk Carriers (a subsidiary of investment company, Ngululu Holdings) was established in 2002. It services the mining market with short and long-haul, side-tipper transport.

Most recently, the fleet has diversified its haulage capacity to include fuel tankers and tautliners for consumer goods. In future, it will include flatbeds for multiple applications.

According to Chris Luvhani, executive chairman, Ngululu Holdings: “While 80 percent of our revenue comes from blue-chip companies based in South Africa, our focus is to operate in the whole of the Southern African Development Community (SADC) region. Our longhaul capabilities and efficiencies are,

therefore, critical to our strategic direction.

“The Scania G460 went through a robust selection process, which included four weeks of test runs for comparative analysis with our existing benchmarks. Ultimately, the Scanias offered us the lowest possible total lifecycle cost.”

Scania Finance facilitated the deal with a flexible and tailored repayment solution. The trucks are backed by a three-year/600 000 km driveline warranty and a full maintenance and repair contract.

The Euro-3, 460 hp 6x4 Scania G460 is ideal for on/off-highway applications, with 2 250 Nm of torque for effective tractive force off-road and in mountainous conditions. The semi-automatic Scania Opticruise transmission with a retarder assists in delivering optimal fuel efficiency, as does the aero-kit, which comes as a standard-fitment on the double sleeper cab.

“The G460 delivers a fuel saving of between five and seven percent and has a lower tare mass than the other

Members of the Scania South Africa and Ngululu Holdings management teams celebrate the new partnership.

trucks in our fleet, which boosts the profitability of each trip,” says Flip Myburg, executive director: Fleet & Technical, Ngululu Bulk Carriers. “Our drivers are also extremely happy with the vehicles’ comfort and ease of driving.”

In conclusion, Luvhani states: “The combined elements of this deal, from the best-rate financing package and the efficiency of the truck itself, to the extensive Scania support network in the SADC region, makes for a win-win situation.”

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”The G460 boosts profitability.”

Only one choice Since 2001, the bus group comprising Kopano Bus Service, Madodi Bus Company and Mathole Bus Service has built up a relationship with its bus supplier of choice – Scania South Africa. In fact, the group has 159 Scania buses in its fleet covering local and cross-country operation.

Most recently, on July 13, the group took delivery of ten Scania 65-seater buses – which is in addition to 12 65-seater and three 80-seater buses that joined the fleet in May. Currently, the fleet is comprised of Scania F Type chassis vehicles.

Olivia Maponya, executive director of Kopano Bus Service, explains that the success of the relationship can’t be put down to just one factor.

Operating commuter services across the Limpopo province, as well as being available for private hire and organised parties countrywide, the group requires its buses to be reliable, low maintenance and affordable.

Maponya says that the Scania fleet meets this brief, but it’s also the “behind the scenes” support and service that sets Scania apart as a bus supplier.

“For example, a big advantage is that Scania also provides its own in-house financing,” Maponya adds.

While replacing the fleet on five-year cycles helps to keep it

young and maintenance costs low, it also has another benefit for the group – in that driver satisfaction is raised.

“Our divers always get excited and are filled with hope and confidence when we introduce new Scanias to the fleet,” Maponya says proudly. When new buses are delivered (and whenever required) Scania provides the group’s drivers with training.

“We are able to monitor and manage the drivers’ behaviour and the overall fleet using the Scania Fleet Management System, which is installed as a standard feature to all new buses,” Maponya elaborates.

“The Scania staff are very professional, and we are pleased with the manner in which they support their clients and stand by their products – which gives us an added incentive and peace of mind in our decision to run a fleet that is 100-percent Scania.”

Of course, a relationship is a two-way street. Esaia Taunyane, based at the Scania Elandsfontein dealership, has been dealing with the group since 2007. “This is one very professional operator – from the management to the drivers, inspectors, conductors and workshop staff. If I had to describe a model client, this would be it,” he says.

Kopano Bus Service runs a fleet of 159 Scania buses.

Mega deal!

Earlier this year, Unitrans undertook to run a fleet of ten buses powered by Scania’s nine-litre, 208 kW (280 hp) Euro-6 engine on CNG for five years. The reason behind this was to scientifically calculate their merit – for the bus industry as a whole.

The man who took this bold decision is Leon Nelson, technical director at Unitrans Passenger.

While this is a first for Scania in Africa, the concept is definitely neither new nor untested for Scania. The company has more than 5 000 clean-fuel vehicles under its belt.

“So we were testing an existing technology, but in a new environment,” Nelson explains. Still, it required some truly pioneering endeavours on the part of Nelson and his counterparts at Scania South Africa.

Nelson hopes that the results of the test will be favourable. “We evaluated the possibility of electric and hybrid vehicles. Another option is ethanol, and we’ll probably explore that option at some stage, but CNG made sense for a number of reasons,” he explains.

“Then there is the issue of servicing. Our diesel-powered buses have 20 000 to 30 000 km service intervals; these vehicles will be serviced every 30 000 to 40 000 km.

When it comes to servicing, labour costs will be reduced.”

The buses, branded Mega Bus, will be serviced at the company’s depot (with the assistance of Scania). They will average 10 000 to 12 000 km a month (three times the distance of a normal city bus).

“There are some new challenges – refilling is different and the tanks are heavier than those used for diesel. We are using Type 4 carbon-fibre tanks to mitigate this. However, based on overseas reports, I do believe that CNG could be the alternative fuel of the future for South Africa,” says Nelson.

Scania Soth Africa expects that the findings of this five-year project will be very rewarding and that energy security, job creation and CO2 reduction will play a major part in the future of the heavy-duty transport sector in the country.

THE SCANIA

LINK 125 years of innovation Scania’s roots stem from the privately owned wagon-building company Vabis, which was established in Södertälje, Sweden, in 1891.

However, the Scania link didn’t happen until 20 years later, when Scania-Vabis was created through the amalgamation of Vabis with the Malmö-based, privately owned machinemanufacturing company Scania.

Today, Scania is one of the world’s leading manufacturers of heavy trucks and buses, as well as industrial and marine engines. The company has celebrated a proud heritage of innovation since the early 20th century. For example, Scania-Vabis designer, August Nilsson, developed a four-cylinder, overhead-valve engine in 1923. In 1936, the company developed its first diesel engine, which impressed the trade press during test drives.

That set the tone for the company’s future engineering efforts. In 1969, the 261 kW (350 hp), 14-litre, turbodiesel V8 engine was launched and was immediately crowned Europe’s most powerful truck engine – despite pioneering Scania’s philosophy of high-torque

output at low engine speeds.

Another notable award came in 1996, when the 4-series was crowned International Truck of the Year, a year after being introduced.

In 2000, Scania’s millionth vehicle rolled off the assembly line, while in 2010 it gained the world’s most powerful truck engine title with the 544 kW (730 hp) V8. Just last year, the company delivered its 150 000th truck with activated connectivity.

So, what does this proud heritage of innovation mean for the company’s future as it embarks on its next 125 years?

Currently, a great focal point of Scania’s future is global sustainable transport.

Scania’s hard work is certainly paying off.

For example, the company’s recently launched 18-t hybrid distribution truck has been awarded the prestigious Green Truck Future Innovation 2016 award by leading German trade magazine Verkehrsrundschau.

Here’s looking forward to another 125 years of invention and innovation from this most admired of Swedish commercial vehicle brands.

Yet another accolade!

Following its international launch in Paris during September, Scania’s new R and S-Series truck range has been elected International Truck of the Year for 2017!

Features that impressed the jury included the shorter gearchanging time of the automated Opticruise gearboxes, the performance and fuel efficiency of the 13-litre, six-cylinder, 373 kW (500 hp) engine, and the fact that all SCR-only Scania Euro-6 engines in the new generation can run on hydro-treated vegetable oil (which means a reduction in CO2 emissions of up to 90 percent).

Scania’s new cab also delivers improved driver vision, thanks to a revised driving position; a larger glass surface; a lower instrument panel and optimised, non-

intrusive A-pillars. Moreover, the top-ofthe-range “S” cab offers a truly car-like driving experience, as the Truck of the Year journalists noted during a recent field test in Sweden.

Unfortunately the new range is currently available only in Europe and will not be available for the African market before 2019. But it will definitely be worth the wait!