Bodywork manufacturing market outlook 2017

Published on by Jennifer ABIJABER - updated on

The French bodywork manufacturing industry succeeded in capitalising on volume growth opportunities in 2016 on export markets, all the more so as this growth had been well-anticipated, in particular on the HGV and Semi-trailer and Trailer segments.

Outlook for new vehicles in Western Europe (EU-15 + Switzerland & Norway)

Opportunities will continue to abound in 2017, albeit at lower levels, particularly in the Light Commercial Vehicle sector where markets recently benefitted from exceptionally favourable circumstances. Borrowing conditions will still remain very advantageous, whilst profit margins may see their growth start to slow down. Another factor to be noted is the relative leniency of the European Commission with regard to national budgets in 2017: no disciplinary action will be taken on excessive public sector deficits.

Light Commercial vehicle registrations(<5.1t)

2016 will be the third consecutive year for strong market growth (over ten months: +10% in the West and +20% in the East) with only several markets staying off the pace (United Kingdom, Norway, Switzerland, Latvia).

This substantial growth has been driven by several types of factors, some of which will not continue into 2017, which could bring growth to a halt.

Models are thus forecasting moderate growth rates (+1% in 2017 and +4% in 2018).

HGV registrations (>5t)

As anticipated, 2016 was the second year in a two with high growth in registrations (over 10 months: +7% in the West and + 15% in the East) and only several markets not following the trend (Greece, Hungary, Czech Republic). Following their sharp upturn in 2015, tractors continued to grow but at a slower rate. The market has already surpassed its annual long term volume and will continue to consolidate in 2017.

As expected, distribution trucks accounted for the lion’s share of growth in 2016 and this trend is set to continue this year: vehicle fleets have aged and some economic sectors in Europe are booming. Overall market models would indicate a growth rate of approximately 5% in 2017. 

Semi-trailer and trailer registrations

As forecasted, the semi-trailer and trailer market continued to expand in 2016 (panel of 6 countries reporting +10%). There was a foreseen acceleration in Eastern European countries (Polish market reporting +24% in 11 months). The market will now continue to grow at a more moderate rate; vehicle fleets in the West do not need to be extended and some markets are reaching their historic highs.

Statistic modelling also forecasts slower growth (1 to 3% in 2017).

Outlook for new vehicles in France 

The French bodywork manufacturing industry succeeded in capitalising on volume growth opportunities in 2016 on domestic markets, all the more so as this growth had been well-anticipated, in particular on the ST&T segment. 2017 will also offer opportunities in the different market segments: 

Light Commercial vehicle registrations (<5.1t)

2016 was a year that saw the market accelerate (+9% over 11 months) despite a flat Company LCV segment (0% over 10 months) due to a transfer to personal vehicles. Sales to Firms and Long-term rental companies fuelled the trend (+7% in 11 months, 78% of the market), aided by the powerful support of sales to networks (+27%) and to Short-term rental companies (+11%).

Overall, statistic modelling predicts a continued recovery for the LCV market in 2017 at a rate of 2 to 3%. 

HGV registrations (>5t)

The market grew robustly in 2016 (+14% in 11 months) with, as expected, an upturn for distribution trucks. Beyond the economic conditions which should facilitate business in 2017, the forces already in evidence in 2016 will continue to have a beneficial effect in the coming year: there is a need for younger fleets (as a reminder, nearly a third of the fleet was over 11 years of age in 2015) which can benefit from the latest powertrain technology. The volumes of tractor units had already reached their highest annual average in 2016 thanks to a fleet adjustment which maintains high average mileage and the renewal rate at a high level.

Overall, 2017 is predicted by statistical models to witness continued IV market growth of around 4%. 

Semi-trailer and trailer registrations

The market in 2016 closely followed expectations: it had been forecasted that the growth rate would slow slightly (+6% over 11 months) following two years of rapid growth. Industry professionals still expect the market to grow slowly, this time in step with the tractor unit market. 

Registrations by body range 

Registrations of "Dry freight" vehicles increased in 2016 as had been anticipated in autumn 2015. Markets in 2017 will see two contrasting forces in play: on the one hand, aging fleets which require renewal, and on the other, limited growth potential for new vehicle sales due to shrinking business activity.

All statistical models see continued market recovery for Dry Freight distribution trucks of between 4 and 6%.

Registrations of Dump trucks joined in with the recovery in 2016, as had been announced in 2015. The volumes reached even surpassed the forecasts made at the beginning of 2016, indicating that buyers took advantage of good borrowing conditions to renew their ageing fleets. The economic environment will continue to assist the continued recovery of the Dump truck market in 2017. All statistical models indicate that this market will continue to grow in 2017 by 5 to 10%. 

The registrations of Refrigerated vehicles recorded a historic high in 2013. Forecasts in early 2016 had anticipated high figures which were surpassed by actual performances. This is a reflection of the heavy vehicle peak of 2008 over an 8-year cycle.

The outlook remains positive for 2017. 

Source : BIPE