LESSONS OF THE THREE Rs
Page 26
If you've noticed an error in this article please click here to report it so we can fix it.
The experts all agree. By 2000 there will only be four truck manufacturers left standing in Europe. Which four is far from clear—it depends on which manufacturer you talk to. But to a man they all reckon that they'll be there busy making trucks well into the 21st Century.
History would suggest otherwise. During the past 40 years the number of volume truck builders in Europe has shrunk from over 60 to fewer than 10. That's the economic reality. Today there is enough spare capacity among the European truck makers to service the market several times over. And as the recession starts to bite in France and Germany, and overcapacity gets worse, there's likely to be a few more casualties.
Over the past 10 years truck manufacturers have fallen back on the three "R"s to hide the fact they haven't been making money :Rationalisation; Restructuring; and Reorganisation. But it hasn't fooled anyone. The only word that counts nowadays is appar ently "Merger".
Now, after months of spec
ulation, the bans have finally been read for Volvo and Renault as the long-awaited full-blown merger goes through. According to the official state ment: "This dynamic and growth-orientated merger is a direct consequence of the increasingly harsh competitive climate which is making cost effectiveness and a strong market presence increasingly essential." They would say that. But how will it be viewed by their customers? To the average British haulier the international machinations of global truck corporations are like the blush on a dead man's cheek—totally irrelevant. What old Joe Soap Haulier really wants to know is whether a grand "post-merger" reorganisation will leave qim 50 miles from his nearest dealer.
But back to the official statement: 'Synergies will increase and provide the best possible conditions for achieving sizeable and rapid cost savings." In short, sooner or later, something will have to go. Otherwise why merge, if not to remove duplication? However, both manufacturers are insistent that: "Renault and Volvo brands will maintain their separate identities, their full product ranges and their specific commercial networks." They'll need to. Too many operators throughout Europe have already nailed their colours to both marques only to find one suddenly disappearing as part of a "Corporate Strategic Plan." Before everyone goes merger mad let's spare a thought for those minnows "left behind" in the postmerger pool. The most obvious one is ERE Self-appointed pundits have been writing the independent Sandbach-based truck maker off for more years than we can remember: "too small to survive"; "not big enough to invest in future products"; "first to go to the wall come the recession" are just some of the nice things its rivals have been saying about it. So we'll leave them with this thought. Next weekend ERF will be celebrating its 60th Anniversary. We're sure there's a message there somewhere.