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Emerging Hotspots for Commercial Vehicles in Africa

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Given increased changes in legislation on imports and exports of commercial vehicles in various African countries, a major shift is expected to take place amongst the dominant suppliers of commercial …

Given increased changes in legislation on imports and exports of commercial vehicles in various African countries, a major shift is expected to take place amongst the dominant suppliers of commercial vehicles across the continent. China is anticipated to play a key role in determining the future suppliers of commercial vehicles in Sub-Saharan Africa.

This briefing will identify how the Sub-Saharan African commercial vehicles market is expected to evolve between 2012 and 2020.

Published in Business , Automotive
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  • 1. Emerging Hotspots for Commercial Vehicles inEmerging Hotspots for Commercial Vehicles in AfricaAfrica Key Trends in SubKey Trends in Sub--Saharan AfricaSaharan Africa DerrickDerrick ChikangaChikanga, Research Analyst, Research Analyst Automotive and TransportationAutomotive and TransportationAutomotive and TransportationAutomotive and Transportation AfricaAfrica © 2012 Frost & Sullivan. All rights reserved. This document contains highly confidential information and is the sole property of Frost & Sullivan. No part of it may be circulated, quoted, copied or otherwise reproduced without the written approval of Frost & Sullivan.
  • 2. Functional Expertise 6 years of research and consulting expertise, which include more than 26 research and 21 consulting projects. Particular expertise in: - Research, Data Collection and Analysis - Report Writing and PowerPoint Presentation - Contacts Establishment and Project Management Industry Expertise Experience base covering broad range of sectors, leveraging long-standing working relationships with leading industry participants’ Senior Executives - Electronic and Security Systems - Automotive & Transportation Industry - Water and Wastewater Treatment Technologies; Waste Management and Waste-to-energy - Renewable Energy Technologies - Air Pollution Control Technologies; HVAC and Lighting Equipment; Facilities Management Derrick Chikanga Research Analyst Frost & Sullivan South Africa Derrick Chikanga 2 - Air Pollution Control Technologies; HVAC and Lighting Equipment; Facilities Management - Energy Efficiency Technology Analysis (Lighting, HVAC, BMS) - Sub-Saharan Africa Infrastructure Development Analysis (Transportation, Energy and Power, Telecommunication, Social and Water Infrastructure) What I bring to the Team Solid Research and Analytical Skills Client Relationship Management Industry Experience; Broad Network of Industry Contacts Career Highlights Extensive expertise in the Southern African Environmental and Infrastructure Sectors Education MCom Finance (Financial Management) from University of Cape Town, Cape Town, South Africa (On-going) BCom (Hons) Financial Analysis & Portfolio Management from University of Cape Town, Cape Town, South Africa BCom (Hons) Economics from University of Cape Town, Cape Town, South Africa BCom Economics & Finance, Cape Town, South Africa South Africa Cape Town
  • 3. Focus Point Slide Number Market Overview 4 Market Dynamics 6 Historical Trends 7 Key Market Participants 8 Agenda 3 Market Forecasts 10 Key Competitive Factors 11 Mega Trends 12 Future Market Outlook 14
  • 4. Key Commercial Vehicles Markets (Africa), 2013 1) Nigeria : INNOSON Vehicle Manufacturing (IVM) Co. Ltd 2) Ghana : JOSPONG Automobile Assembling Plant WEST AFRICA 1. Egypt : Mitsubishi , Chevrolet, Volvo, MCV, JAC 2. Morocco: Hyundai, Renault, Volvo, MAN, Scania, DAF 3. Algeria : Scania, Tata, Isuzu , Foton, DAF, Hyundai NORTH AFRICA EAST AFRICA SOUTHERN AFRICA Market Overview Overview of Vehicle Manufacturing Plants in Africa 4 1. Kenya : Kenya Vehicle Manufacturers (KVM) 2. Tanzania : Bajaj Auto Limited 3. Uganda 1) South Africa : Toyota, Ford, Madza, Nissan, General Motors, Mercedes- Benz 2) Zimbabwe: Willowvale Mazda Motor Industries (WMMI), Quest Motor Corporation (QMC) The commercial vehicles market is mostly dominated by second hand vehicles from North America, Europe and Asia Currently there are a few vehicle assembly plants mostly located in South Africa and North Africa. The limited sources of funding available to vehicle manufacturers have restrained market development. Source: Frost & Sullivan analysis.
  • 5. USA – 18.2% Chevrolet, Ford Japan – 23.3% Mitsubishi, Isuzu, Toyota, Hino, Nissan Europe – 25.1% Mercedes, Iveco, Renault, Volvo, DAF, Scania, MAN, VW Truck and Bus Market: Country of Manufacturing Origin, Africa, 2012 Market Overview Overview of Vehicle Imports into Africa 5 China – 19.7% JAC, FAW, JMC, Foton Motors, Shaanxi, King Long South Korea –13.7% Hyundai, Tata Daewoo Note: All figures are rounded. The base year is 2012. Source: Frost & Sullivan analysis.
  • 6. Drivers High urbanisation growth rates Sustained economic growth Increased government support Challenges Changing Consumer Demands Legislative Restrictions Market Dynamics Key Challenges, Drivers and Restraints 6 Restraints Limited sources of vehicle financing Alternative modes of transportation High production costs Skills Shortage Legislative Restrictions Source: Frost & Sullivan analysis.
  • 7. Historical Sales of Buses, Light, Medium and Heavy Vehicles (Sub-Saharan Africa), 2000-2011 200,000 250,000 300,000 350,000 VehicleandBusSales LCV MCV/HCV Buses Historical Trends Historical Vehicle and Bus Sales Peak period: • LCV : 306,886 units • MCV/HCV: 55,659 units • Buses: 12,421 units 7 0 50,000 100,000 150,000 200,000 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 VehicleandBusSales Year Note: All figures are rounded. The base year is 2012. Source: Frost & Sullivan analysis.
  • 8. Truck and Bus Market: Truck Segment, OEM Market Share, South Africa, 2012 Truck and Bus Market: Truck Segment, Sales by OEM & Sub Segment, South Africa, 2012 Isuzu 11% Iveco 4% MAN 7% Volkswagen Toyota 12% Others 18% Scania Tata Volvo Toyota Others 4828 Units 3295 Units 1615 Units 1520 Units 1332 Units Key Market Participants Major Vehicle Manufacturers in South Africa 8 Volkswagen 5% Mercedes 27%Scania 5% Tata 5% Volvo 6% 0% 20% 40% 60% 80% 100% Isuzu Iveco MAN Volkswagen Mercedes MD Trucks HD Trucks XHD Trucks Bus 7244 Units 1263 Units 1947 Units 3122 Units 1079 Units Note: All figures are rounded. The base year is 2012. Source: Frost & Sullivan analysis.
  • 9. Key Market Participants Major Vehicle Models in Africa 9
  • 10. CAGR:7.6% Forecast of Bus, Light, Medium and Heavy Vehicles from 2012-2017 150,000 200,000 250,000 300,000 350,000 400,000 450,000 VehicleandBusSales Market Forecasts Forecasted Future Sales Growth 10 Note: All figures are rounded. The base year is 2012. Source: Frost & Sullivan analysis. LCV MCV HCV Buses Total CAGR (%) 7.9 6.8 6.8 6.7 7.6 2012 2013 2014 2015 2016 2017 Buses 6,305 6,704 7,146 7,628 8,148 8,725 HCV 19,775 21,014 22,409 23,944 25,566 27,395 MCV 43,877 46,685 49,823 53,267 56,936 60,966 LCV 210,158 226,072 243,850 263,127 283,587 306,708 0 50,000 100,000 150,000 VehicleandBusSales
  • 11. Key Competitive Factors, 2012 1. Price 2. Maintenance costs 3. Fuel efficiency 4. After sales services 5. Availability of spare parts Key Competitive Factors Market Competitive Elements 11 6. Carrying capacity 7. Reliability 8. Minimum downtime 9. Versatility 10. Comfort Pricing remains the key competitive element in the commercial vehicles market Source: Frost & Sullivan analysis.
  • 12. Regional Integration Future Infrastructure Mega Trends Top Mega Trends Anticipated to Impact the Commercial Vehicle Markets 12 Urbanisation New Business Models Future Infrastructure Source: Frost & Sullivan analysis.
  • 13. Sub-Saharan Africa’s markets currently offering potential for expansion in assembly/manufacturing activities Share of European and American OEMs expected to shrink in short-medium term ConclusionFuture Market Outlook Future Outlook 13 Source: Frost & Sullivan analysis. Future infrastructure development to drive Sub-Saharan Africa’s commercial vehicles market Growing demand for low-cost trucks expected Expansion of OEMs product portfolio, especially in bus segment Conclusion
  • 14. Next Steps Develop Your Visionary and Innovative Skills Growth Partnership Service Share your growth thought leadership and ideas or join our GIL Global Community 14 Skills Growth Partnership Service ideas or join our GIL Global Community Join our GIL Community Newsletter Keep abreast of innovative growth opportunities
  • 15. Your Feedback is Important to Us What would you like to see from Frost & Sullivan? Growth Forecasts? Competitive Structure? 15 Emerging Trends? Strategic Recommendations? Other? Please inform us by “Rating” this presentation.
  • 16. Follow Frost & Sullivan on Facebook, LinkedIn, SlideShare, and Twitter http://www.facebook.com/FrostandSulli van http://www.linkedin.com/companies/4506 1616 http://www.linkedin.com/companies/4506 http://www.slideshare.net/FrostandSullivan http://twitter.com/FrostsullivanSA
  • 17. For Additional Information Samantha James Corporate Communications +27 (0)21 680 3574 Samantha.james@frost.com Derrick Chikanga Research Analyst – EBT / A&T +27 (0)21 680 3204 Derrick.chikanga@frost.com 17 Kudzanayi Bangure Programme Manager – EBT / A&T +27 (0)21 680 3207 Kudzanayi.bangure@frost.com Guillaume de Bassompierre Director – Business Development +27 (0)21 680 3203 Guillaume.deBassompierre@frost.com