Commercial Vehicles: German Market Once Again Experiences a Sharp Decline – Manufacturers Adjust Production Planning
Frankfurt am Main, February 5, 2009. Sales of commercial vehicles in Germany declined sharply in January 2009. New registrations fell 29 percent in the first month of the year, as the drop in demand from the last quarter of 2008 not only continued, but also accelerated. At 12,300 units, new registrations for vans were down 31 percent from January 2008, while sales in the heavy-duty truck segment (over 6-tons GVW) decreased by 26 percent, to slightly more than 6,000 units. "The German commercial vehicle industry is currently in a cyclical downturn whose effects are being dramatically amplified by the financial crisis," says Matthias Wissman, President of the German Association of the Automotive Industry (VDA). "Our customers in the freight-forwarding sector are also being very hard hit by the road-toll hike that went into effect on January 1, 2009 - an increase that couldn't have come at a worse time."
Domestic orders have fallen sharply for both vans (-31 percent) and heavy-duty trucks (-72 percent), and there are no signs that orders may soon pick up following the very weak second half of 2008.
Commercial vehicle exports also declined significantly in January, as export sales of 11,760 units were at their lowest level since 1995. The negative trend of the last few months for orders from abroad also continued into the new year, with such orders declining by 61 percent.
In response to these developments, German manufacturers of vans and heavy-duty trucks have dramatically cut production. A total of 20,330 units of these vehicles were produced at German plants last month, a decrease of 47 percent from January 2008.
German manufacturers of trailers and truck bodies - the market leaders in Europe - had already been experiencing double-digit declines in new orders since the beginning of 2008. Over the last few months, however, orders have plummeted by more than 90 percent in some cases. It generally takes some time for a decline in new orders for heavy trailers to be reflected in new registration figures. Nevertheless, the fourth quarter of 2008 already showed a decline in new registrations of approximately 33 percent, while the decrease in January totaled 50 percent.
The dramatic drop in new orders is also fully impacting capacity utilization at German trailer and truck body manufacturers, which have cut back production by an average of more than 70 percent over the past few months. Some manufacturers also cut production by as much as 90 percent in January.
"The German commercial vehicle sector faces huge challenges in 2009. However, the globally recognized technological leadership of our companies in this sector is the key to overcoming the crisis," says Wissmann. "What we need to do now is quickly come up with and implement an efficient emergency credit and loan-guarantee plan in order to safeguard the supply chain, and thus the innovative strength of the entire industry."
