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SIGNS OF A BUSINESS RESURGENCE AT SERCO: Good News for 2025
Business is taking an upward turn at leading South African truck and trailer building company, Serco. The signs of resurgence bode well for trade in the new year. Serco CEO, Clinton Holcroft, reports cyclical improvements in orders and inquiries as 2024 draws to a close. His optimism is further bolstered by recent stability in the country's electricity supply and the relatively smooth introduction of the Government of National Unity (GNU).
Holcroft emphasises the need for more decisive steps from the government to unlock economic growth. "If we can see more collaboration between business and government, it is very possible to achieve the 3% plus growth needed to reduce unemployment," he said. He highlighted the importance of addressing policies that have hampered development, resulting in high levels of poverty and joblessness.
Challenges in 2024 and Market Recovery Hopes
Despite the optimism, Serco faced a challenging year, with a decline in demand for new vehicle bodies. Orders for refrigerated trailers were particularly slow, down by more than 50% compared to the previous year. The company also had to navigate significant supply chain disruptions, including congestion and delays at South African ports and the impact of the Middle East conflict forcing shipping lines to avoid the Red Sea.
“If we can see more collaboration between business and government, it is very possible to achieve the 3% plus growth needed to reduce unemployment.” – Clinton Holcroft, CEO of Serco
Holcroft noted that although progress has been made with the GNU and improvements at Transnet, issues such as border post delays and port inefficiencies continue to pose serious challenges. He remains hopeful that 2025 will bring improvements in commercial vehicle body volumes, with key customers planning to increase replacements and a favourable interest rate cycle encouraging transporters to upgrade their ageing fleets.
Key Developments and Innovations
One of Serco's strategic priorities has been the use of sustainable power sources. The commissioning of solar power at their Cape Town facility has led to a record milestone of 67% of the company's electricity needs being met through solar power. Holcroft confirmed that this initiative will continue to be a focus moving forward, contributing to lower operating costs and environmental sustainability.
Additionally, Serco has expanded capacity at its Johannesburg factory with the commissioning of a CNC cutting and bending machine, providing ample space for future growth as product volumes increase. This expansion is expected to improve production efficiency and support the company’s strategic goals.
Product Expansion and Technological Advancements
Serco has made notable strides in broadening its product range. The company introduced a new multimode side and rear curtain-sider trailer for beverage transport, alongside a lightweight curtain-sider interlink trailer and drop side vehicle bodies. The product range now includes refrigerated, dry freight boxes, van bodies, and curtainsider bodies, catering to diverse industry needs.
Furthermore, Serco has added a lightweight GRP composite model to its refrigerated trailer offering, complementing the existing Proteccoated steel refrigerated trailer and the premium Protec plus refrigerated trailer. These advancements enhance durability, efficiency, and energy savings for customers.
Serco also delivered a number of trailers for leading local transporters incorporating the latest e-charging axle system to power refrigeration units. The company was the first to build one of these units using the BPW axle-driven system to power a Thermoking Advancer 500. There are orders for a further 11 units which Serco will deliver by year-end.
Strategic Partnerships and Market Positioning
A major highlight for Serco in 2024 was the investment by Bidvest, which Holcroft describes as a significant boost that will underpin future growth plans.
This partnership is expected to strengthen Serco's market positioning and drive expansion in the coming years.
Another challenge on the horizon is the influx of Chinese vehicles into the South African market. Holcroft warns that the potential allowance of complete vehicle imports could pose competition to local manufacturers. However, he remains confident that Serco’s innovation and quality will continue to provide an edge.
Financial Flexibility and Rental Options
In an effort to make its products more accessible, Serco is set to introduce finance options for new trailers, offering customers a more convenient onestop-shop solution. The company also now offers a fleet of refrigerated rental trailers available for short- and longterm rentals, catering to various client needs and helping businesses remain operational without large capital outlays.
Holcroft expressed enthusiasm about the rental division's growth, noting that this service has become increasingly popular among transporters looking for flexibility in fleet management.
Future Outlook and Global Insights Holcroft expressed excitement about the future following Serco's recent visit to the IAA show in Hanover, where they explored cutting-edge developments in reducing vehicle emissions, lowering operating costs, and improving efficiencies through advanced technology.
"The future looks very exciting, particularly when it comes to powering trucks and trailers using new technology," he concluded. He remains optimistic that with continued collaboration between industry players and government stakeholders, Serco and the broader transport sector can look forward to sustainable growth and innovation in the years ahead.
ABOUT SERCO INDUSTRIES (Pty) Ltd
Serco Industries specialise in the design and manufacturing of insulated and dry freight truck bodies and trailers. These trailers are relied upon by Southern Africa’s leading transporters and long-distance hauliers to carry everything from ice cream to day-old chicks, from beef to bread –safely and hygienically.
Serco’s success as a market leader can be attributed to its design, innovation and the quality of products and services. With extensive experience in specialised fields as well as in-house design capabilities, our clients have no doubt they have selected the right partner to ‘give them the edge’ in a competitive market.
Serco’s head office is in Durban, with branches in Johannesburg, Cape Town and Gqeberha.
