20 | REPORT
Iveco’s 33rd ‘State of the Nation’ .. outlines issues and challenges
Iveco’s 33rd ‘State of the Nation’ briefing at the CNH Industrial HQ in Basildon covered familiar issues and topics such as Brexit, Covid, Supply Chain and component shortages. All these factors have changed the business landscape, and with the outbreak of war in Ukraine, it looks like the anticipated economic recovery has taken yet another serious knock. As Lisa Fuller, Communications Director, Iveco UK & Ireland appropriately stated: “Change is natural, it’s organic, it’s gradual. But what’s been going on in our world recently is far from that ... Upheaval might be a more appropriate description!” Despite all these disruptions, Iveco remained busy over the recent difficult two year period, with Mike Cutts, Light Business Line Director saying that over that time van demand boomed, although component supply delays did cause some lead time issues: “We think we were in a better position than most. Apart from a 2-week period when production slowed through a lack of components, we continued to build throughout the year.”
FLEETTRANSPORT | APR - MAY 22
With Covid restrictions limiting business and movements in general during 2020, the following year saw the van market return to significant growth. Mike explained what was behind this development: “Delayed orders and a huge slice of natural recovery, unsurprisingly. Activity had plummeted between March and September 2020 while we were in lockdown mode. Uncertainty and a lack of confidence (particularly on CapEx expenditure) was the name of the game, with operators delaying their replacement plans and looking at ways of running their vehicles for longer. But all that did was build a head of steam, and as we left 2020 and entered 2021 - as the pandemic smoothed and restrictions began to be lifted - demand came back with a vengeance.” “Life went on regardless for some businesses such as the utilities sector throughout the pandemic. Large-scale infrastructure projects, house building and the expansion of broadband remained on course, with governments maintaining commitments and looking to spend their way out of the crisis. This gave operators the confidence to start investing once again.” “Home delivery of groceries and other essentials doubled during the pandemic – parcel deliveries boomed too - and that shift will remain. Sure, it’s likely to balance out slightly as things return to normal and people get back to retail outlets. But we’ve become used to that way of shopping - we’ve experienced its convenience, and we’re unlikely to move away from it again.”
“As a manufacturer focused more on the needs of professionals, our Daily product was well-suited to capitalise on the strongest growth areas - dot com, construction and the utilities. Indeed, some 70% of our 3.5 tonne volumes were
Mike Cutts, Light Business Line Director chassis-cab, bodied vehicles as opposed to simple white vans. Not only that, we took the strategic decision to re-enter the dot com channel in particular, with a 5-year strategy. As an example, we delivered 645 3.5 tonne Dailys to Tesco last year while other manufacturers struggled to supply.” “We also re-engaged with the rental channel. Fact is, because of their robust truck design DNA, our Daily products have a longer first life than other competitor brands. That delays their return to the used market and distorts the RV in the guides due to an older age profile and their condition at auction. Regardless of what they are, rental vehicles have an average first life of 24 to 36 (occasionally 42) months – so when they come to market, because they’re younger, their RVs have a positive impact
