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From cradle to grave
Page 72
Page 73
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MAN-ERF is serious about used trucks — and it intends to prove it Emma Penny reports.
The trend for manufacturers to take control of used truck sales is gathering momentum.The days of a glut of used vehicles coming onto the market and pushing prices down seem to be over. Most manufacturers, after being badly burnt by suicidal buyback deals, now take a far stronger line in protecting their residual values.
After launching MAN Diesel a couple of years ago in a bid to make their used truck business more professional, the German firm has now unveiled its latest initiative — a UKwide network of six MAN Diesel regional centres, They will be owned and run by MAN itself as there are no problems with block exemptions in the used market.
MAN-ERF UK chief executive Des Evans says the centres will be selling used vehicles "but not as you know it". He aims to make the used truck buying experience more like buying a new vehicle, with professional showrooms and salespeople.
All MAN staff are going through a customer care programme —Evans predicts service levels will soon be the only differentiator between marques: "A truck is a truck is a truck. Service will be for all.We recognised that this was a weakness, and we want to change the experience for our customers — we want friendly people providing great service."
Evans reckons plenty of people will benefit from this approach; he believes many operators can ill-afford to buy new, estimating that there are 40,000 operators running fewer than 25 trucks: "They will have a turnover of £2m or less, and with a 3% return on sales they might make £60,000 in a good year. New trucks cost about £60,000, so they might just be able to afford a brand new truck," But he adds that those 40,000 operators will be able to afford his "brand new three or four year old truck", saying:"We are providing the answer for the small guy looking for reliability and quality."
MAN sales director David Cussans, who looks after both new and used truck sales, says the new venture means the company will be looking after its vehicles from start to finish. With an investment of £10m in the six new centres there's a big outlay to pay back, but MAN's target is to sell 1,800 vehicles through the six centres this year. Its 'private capital' dealers — those not owned by the manufacturer — have a target of 1,000 used sales.
Fate of the aged
Vehicles more than five years old and entering their 'third life' are likely to be disposed of through independent traders — Cussans reports that MAN-ERF is currently compiling a list of 'preferred' independents. Another 400 trucks a year will be exported to right-handdrive markets.
All vehicles coming through the regional centres and private capital dealers will be less than five years old with low mileage and a full service history. Cussans says: "Most of them will be leased vehicles coming back to us, hut we will also have some which will come in as part-exchange on new vehicles."
Once the trucks are in the MAN Diesel system they will be serviced,inspected, valeted and roadtested.They'll then be sold with a three-month bumper-to-bumper warranty. This is currently covered by an insurance company but it could be replaced by a manufacturer warranty in the near future. Buyers can also opt for an R&M contract via local MAN-ERF dealers.
Strong flow of trucks Cussans says there are enough vehicles :oming back to MAN to supply the network: "The volume we face is what is driving this strategy." And he stresses that vehicles will be Illocated on a round-robin basis, with no preference given to regional centres over private capital dealers.
However, the company clearly expects all its Jealers and operations to perform when it :omes to used sales. Evans says that if outlets we not selling as many units as expected,MANERF UK will send in its own salespeople. He adds that this approach has benefits for such dealerships as it allows them to concentrate on after-sales service, which is more profitable than vehicle sales.This is another reason why he believes MAN-ERF dealers will welcome the focus on used vehicles: leasing a used truck with an R&M package is likely to become a much more common practice.
With VOSA and the HSE becoming increasingly tough on operators whose vehicles fall below the required standards, dealer servicing on used vehicles will become more common, he suggests:"Maintaining a truck now means handling a computer, and that has lobe done at authorised centres."
Cussans concludes that offering a variety of finance options for used buyers. coupled with the ilOm investment in these new centres, "makes a statement about how serious we are". Regional centres are already open in Edinburgh, Scuntliorpe,West Bromwich and Avonmouth; sites will open in Enfield and Manchester by the end of June. •