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World stage will

25th November 2004
Page 70
Page 70, 25th November 2004 — World stage will
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Which of the following most accurately describes the problem?

set scene for 2005

Crystal balls aside, Glass's Guide suggests looking at real events is the best guide to used CV prices in 2005.

What will 2005 bring the used CV market'? Next year could well see a general election and new incumbents could bring added confidence. The Iraqi crisis might be resolved, opening the door for rebuilding and even more export opportunities.The Working Time Directive will transform manpower,fleet size and financial turnover.The advent of Euro4 emission limits could cause a final flurry of demand for Euro-3.And diesel prices might — might — drop if stability is achieved in the Middle East, which is OPEC heartland.

In general Glass's Information Services (GIS) is optimistic about new and used CV sales next year, although market volumes are expected to drop below 2004 levels by the summer.

George Alexander, GIS's chief editor of commercial vehicles, predicts that in the first half of 2005 "van registrations should hold up better than those for trucks".

Much will then depend on whether a General Election is held — and who wins it. If the international situation continues to deteriorate and the domestic economy does not receive any cash injections,Alexander reckons registrations will finish 5% down for the year.

The make-up of vehicles in the used market will start to change, he suggests, with more cutting edge trucks and Euro-3 engines finding their way to the used sector.The trade is counting the days to regular supplies of Mercedes-Benz Axors, Iveco Eurocargos and an increasing number of Stralises, plus Volvo's latest generation FM.s and Fl-Is with I-Shift.

A slowdown in turnover might not be all bad news for the UK's CV market."Over the longer-term such a drop in registrations would be no bad thing as it would lift some of the downward price pressure from late-year stock," says Alexander.

Exports might suffer a little if prices rise on older vehicles. Increasingly, exporters are sourcing newer products —four and five years old — on a more regular basis, so they might be forced back down the food chain.

Better mix There should also be a better mix of tractor axle configurations, with more late-year 4x2s becoming available as it's three years since the vehicle excise duty rates were evened up.

Many van and truck manufacturers based on the Continent see the UK market as their leading export.Alexander says that since the turn of the millennium, the UK truck market in particular has sustained "most of the burden for chassis sales across western Europe with Continental manufactures sending an increased percentage of their production here.

"Fortunately," he concludes, "with a healthy domestic economy we were able to easily absorb the extra numbers. But manufacturers should appreciate that these were exceptional years and not the norm."•


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