Capital Equipment News September 2019

MEDIUM COMMERCIAL VEHICLES

been prioritised to ensure that all products are supported in line with OEM expectations throughout the dealer network,” says Selesnick. Key challenges While the product is seemingly proving itself, there are several challenges that Selesnick believes are holding back the market. Top among them is the general tough nature of the economy in South Africa, which has had an adverse impact on the truck market at large. To give an idea, Selesnick refers to the declining trend of the medium commercial vehicle market between 2017 and 2019. Looking at the equivalent of the FT3 segment, a market that was about 1 500 units per year in its heydays, has since shrunk to 1 000 units per annum. Another challenge, according to Selesnick, is the general disdain that the Chinese product has been viewed with over the years. “The challenge of bringing a new Chinese product is that the market has previously been infested by a lot of ‘fly by nights’ and customers are very wary of that, given that South Africa is a mature buying market. It takes time to dispel the negative sentiment by proving that the product can actually do what you say it does, and proving that you can offer the necessary backup support,” he says. While this product speaks directly to the new, upcoming fleet owner, Selesnick says a big challenge for this group of customers is lack of financing, especially considering that banks’ appetite for risk is low during tough economic cycles. “We see a lot of new fleet owners trying to establish themselves, but the stumbling block is that while they may have the acumen to do business, being able to finance the product isn’t easy in this economic climate,” says Selesnick. Selesnick believes that the government can play a bigger role in helping these SMMEs find the traction they need in a merciless trading environment. For example, he believes that the transport department can encourage ways to put new commercial vehicle fleet owners on the road, probably by engaging banks to see if there is room to help these entities get finance to buy the trucks they need. “For me, transport is not just about policing of the road, it’s about creating opportunities for new trucks to be licensed, thus more revenue for the government. Licensing of vehicles and trucks is a huge income generator for the government and I think it’s time the government prioritises the commercial part of the transport industry more,” concludes Selesnick. b

The Powerstar FT product range offers the same high-quality technology bracket as the other Powerstar ranges.

locally by Cummins and ZF themselves, and the local arms of these companies were actually part of the testing and approval process of the truck before its introduction in the local market. “The reliability of the trucks has also been very high. During the period we have offered the product, we have measured the warranty claim rate, which is a good yardstick of the truck’s reliability, and it has been excessively low,” says Selesnick. Judging from the feedback from customers, Selesnick says the truck’s fuel consumption statistics have also been very good. This is definitely a key parameter for cash strapped truck owners who are already feeling the pinch of a tough economy. The truck is powered by a Euro III engine, which is not far behind the rest of the pack in this market segment. In fact, some of the Japanese manufacturers are said to be still running a Euro II spec. “The FT product is not at the bottom end of the value market, it is a mid-tier offering that fits just under the Japanese product. The new products that we will soon launch in the market will start to rival the Japanese closely in terms of the specification and quality, but obviously the price point will change. However, when the client base has trust in the brand and has seen the value in the original pricing, they will see value in the next generation despite the change in the price point,” says Selesnick. From a technology point of view, Selesnick says the medium commercial vehicle segment by its very nature is not

high-tech driven market, except for the advent of the automated transmission (AMT) that has over the years become a major trend. “My view is that AMT is actually reaching its saturation point in this market segment. It had its buzz time, and I think that long haul is a segment of the market that enjoys it most but the costs associated with it are prohibitive, especially for the medium commercial vehicle sector,” he says. He adds that the AMT drives the price point of the truck beyond the affordability reach of most emerging truck owners, who are the key target market of this range. Support matters Having a good product is one thing, and being able to offer crucial backup and parts support once the product is operational in the field, is quite another. Based on a clear understanding of this notion, ESI has over the years invested in a strong dealer network across the region, complemented by its financial strength to keep a sizeable inventory of parts to better service its customers operating in the market. “The Powerstar FT build quality at our Pietermaritzburg plant, as well as the aftermarket parts and service regime, are key factors in the early growth of the range. In support of the new Powerstar FT range, we realigned and strengthened our dealer footprint with some significant names that joined our distributor family. The new dealers are financially strong and culturally in-sync with ESI’s values. Training has also

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