Strength in numbers
Almost every van manufacturer will have benefitted from the UK’s rising LCV market in 2014, though Volkswagen Commercial Vehicles’ registrations were particularly strong. The company sold more than 41,200 vans to the end of November, passing its whole year 2013 total of 40,857 a month early.
In that 11-month period, Volkswagen Commercial Vehicles grabbed a 13.4% market share, putting it second behind Ford. That’s an impressive achievement, but even more so when you realise that Transporter, Caddy and Amarok will all be replaced or upgraded in 2015, with an all-new Crafter making an appearance late in 2016. These are hardly run-out figures.
Fleet sales account for around 80% of Volkswagen’s van output, though the firm considers almost any business sale to be fleet.
‘A one man trader is just as important as someone buying 1,000 vans,’ said head of fleet Chris Black (pictured).
‘In every one of our 72 Van Centres we’ve got someone who is dedicated to fleet. Some centres have more opportunity, so they might have two or more, but every one has at least one.
‘We also have a team of five fleet managers who work with the Van Centres and customers, plus two key account managers to look after the 1,000 vehicle plus market.’
Despite this strong presence in the market, he admits that further growth will require additional resource, if standards are to be maintained and lifted further.
‘It’s where I would like it to be today, but we’ve got plans, we want to grow and we are ambitious, which will need more people,’ says Mr Black.
‘We need to look at how the customer wants to be served. How do we help people to find the right vehicle for the right job?’
Having experts that really understand the LCV market is particularly critical as the vehicles get larger. For some time now Volkswagen has been working to boost Crafter sales and its biggest van remains the firm’s biggest opportunity. That said, by the end of 2014, Crafter sales were up an impressive 41.9% on the previous year.
This is in part due to the growing number of bodies available through the firm’s Engineered To Go programme, with a Luton the most recent conversion addition.
‘Engineered To Go is definitely a growth area for us,’ says Mr Black. ‘The vast majority of Crafters will have a reasonable amount of conversion work.’
The next Crafter will break with the Mercedes Sprinter, with which it has shared a chassis and production line, as Volkswagen moves its biggest van to a new site in Poland.
‘It will become immediately apparent to customers how different the new Crafter will be,’ says Mr Black. ‘We will have a much larger client base for new Crafter than before.’
Of course the big news this year is the imminent arrival of the sixth generation Transporter, plus to a lesser extent a new Caddy. Despite T5 coming to the end of its product cycle, the firm’s Hanover plant remains at capacity building the van, such is its popularity both in the UK and on the Continent.
‘It’s the value of the product, we’ve engineered a quality vehicle,’ says Mr Black. ‘Then there is TCO, service and support, the overall proposition has a different value. The demand for T5 is still really strong.’
This is in part due to Volkswagen’s enviable residual values, something that he is keen to maintain going forwards.
‘We are never complacent about RVs as we know it is one of the main strengths of what we do. We could put a lot into rental, but we don’t want to do that as our residuals would be challenged.’
While demand for T5 remains strong, it completely outstrips supply for the firm’s Amarok pick-up, which saw a 19.2% rise in deliveries in 2014. The problem for Volkswagen Commercial Vehicles is getting enough of the trucks from the production sites in Germany and Argentina.
‘We could comfortably sell a lot more Amaroks,’ says Mr Black.
Looking forward, Volkswagen Commercial Vehicles is expecting another strong UK market in 2015, though in an election year there are understandably a number of things that could have a big effect on van sales.
‘Our view is that it will be relatively stable, similar to where we are today,’ says Mr Black.
‘We will however have a balancing act to fulfil demand. We want to be someone that a customer can rely on and use. Let’s make sure that the vehicle is the right tool for the job.’