Simpson no heavy losses
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• Leyland Trucks' managing director George Simpson has a message for any haulier or industry pundit who thinks that, following its merger with Daf, Leyland is going to stop building heavy trucks. He says bluntly: "You're wrong."
If anyone is in a position to say so, he is. As the new chief executive of Leyland Daf UK, he strongly refutes any suggestions that Daf will eventually build all the joint company's heavies, leaving Leyland to produce light and middleweight trucks at its Lancashire assembly plant.
"No, that's not the case. Although what's going to be built where is not totally finalised, the plan is that every righthand-drive vehicle — heavy trucks and all — designed in Britain, or designed in Holland, will be assembled in the Leyland assembly hall. And whether it's a left-hand-drive, or right-hand-drive, everything up to 14 tonnes will also be built there."
Simpson is determined to get this fact across not only to prospective customers, who may think that the Roadtrain is under threat, but also to many people within Leyland's own organisation.
"There is absolutely no decision for LT to get out of heavy production, and Roadtrain will continue to be manufactured, and continue to be developed, for the time being."
LOGICAL However, having merged the two companies, wouldn't it be logical for Leyland to stop building artics, particularly as Daf sells more tractive units in Europe than it does?
Simpson asserts that while "in the fullness of time, clearly there is a vision of an integrated product range for the new company. That is going to take many, many years. In the short/medium term, Roadtrain will be a competitive offering in the market place, and LT will be manufacturing heavy trucks in this country for a long time to come."
His assurance on the future of Roadtrain comes only months before a revised model is due to be launched — probably at the end of the summer.
While work on the joint Daf/Ertasa Cabtec cab is currently progressing — it could be shown by the end of 1987 — Simpson is adamant that the arrival of a new-cabbed Daf heavyweight within the next two years will not put Roadtrain under threat.
"The emergence of a new Daf heavy truck would not necessarily automatically mean that it would be a replacement for Roadtrain — and it's important to get that in your mind. If they did bring out a new heavy truck, let's say in the next two years, they would probably want to sell that in the rest of Europe, where they are strong. And because Roadtrain is competitive, and sells well in the UK, they may well decide to leave a replacement for Roadtrain, if that's what they are going to do, for another three years," he says.
News of the merger has already raised some fears among Leyland's component suppliers — particularly the proprietary engine builders.
Simpson maintains that "we don't see any change in the short term. Again in the long run, because Daf does have an engine range, which in so many cases crosses over with proprietary engines which are available at the moment, somebody will have to make a product development decision."
"But the important thing for people to understand is that the full range of proprietary engines which is offered today will continue to be available. In three weeks time nobody is going to announce that we're no longer going to fit X's engine — it's going to be a Daf. For a start it will take two years just to engineer and test it," says Simpson.
"If you like Eagle engines or a Cummins L10, they will still be available in the company's truck range for a long time to come."
As Leyland has, however, decided to pull out of engine building, it does seem inevitable that Leyland Daf will eventually standardise on a Daf power unit for its heavy truck models.
While this may be the case, Simpson argues that the option of a non-Daf engine in a heavy truck built by Leyland Daf UK is by no means discounted.
OVERCAPACITY So it neither manufacturer is actually giving up any models — with the exception of certain Scarnmell trucks — where is the claimed reduction in overcapacity going to come from?
Simpson cites Leyland's decision to pull out of the engine and foundry business (allowing Daf to make full use of its own engine building facilities) as one example of trimming excess capacity. He also says that "Daf is bouncing up against their assembly capacity in Holland, and part of the attraction (of the merger) is to be able to use the spare capacity at Leyland which will increase the utilisation of Leyland assets, and give better economies of scale. These possibilities, says Simpson, are "not inconsistent."
Is there likely to be a major change in either Wes or Leyland's current UK dealer lineup as a result of the two companies coming together?
Simpson says that the final number of Leyland Daf UK outlets has yet to be decided: "1 don't think that there wili be a lot of casualties — there will be some, as the policy is to have one integrated distributor network."
Describing the merger as very good for Leyland, very good for Daf and good for the European truck industry" Simpson already expects Leyland Daf UK to finish its first full operating year leading the UK truck market.
"It will be disappointing, given market levels at this point in time, to put the two compnies together and not end up with market leadership. We firmly believe that's what we can — and will do.
According to Daf chairman Aart Van der Padt, the new company, which is due to start trading by the end of March, will be profitable from day one — but what about at the end of year one?
IN BUSINESS Despite Rover having up to £750 million of its debts written off by the Government, Leyland Trucks is not about to leap back into the black. The company is, after all, losing up to 21 million a week.
Simpson, however, is already predicting Leyland Daf UK will finish ahead after its first full year in business.
"The new company will certainly not go into a loss-making situation. In other words, if you Lake Des profit and Freight Rover's profit, and you take whatever result the British truck manufacturing company comes up with the company will be profitable — quite how profitable depends on how well we perform".
To see Leyland Trucks simply as part of a profitable company is more than a great deal of people could ever have hoped for.