SOFIA (Bulgaria), April 8 (SeeNews) – French auto maker Peugeot expects its sales of lightweight commercial vehicles in Southeast Europe to rise by around one-third to some 3,400 units this year, a senior company executive said.
The wider lightweight commercial vehicle (LCV) market in Southeast Europe (SEE) is expected to expand by around 28% to 32,700 units this year, Peugeot sales director Central and Eastern Europe Jean Francois Cotro told SeeNews over the phone from his Paris office.
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This will be a tentative recovery that will not start to gain traction before 2012. “We will need at least another 2-3 years to reach the pre-crisis market volumes,” Cotro said.
Last year was tough on the LCV market in the region with sales dropping 27% to 25,590 units as fleet buyers in both the private and public sector tightened their belts.
Peugeot felt the full brunt of the downturn with its LCV registrations in SEE falling nearly 42% to 2,545 units in 2010 while its market share contracted to 9.7% from 12.2%. The biggest drag on the company’s performance on the LCV market last year was Romania, Cotro said.
“Our performance in all other SEE countries last year was flat or slightly better, like in Slovenia, for instance. But in Romania, Peugeot’s LCV market share tumbled to 4.0% in 2010 from more than 12% a year earlier.”
The main reason was the inventory build-up before the crisis. Peugeot faced a huge destocking effort in Romania in 2009, especially in the last quarter of that year. It resulted in good sales figures for that year but also undercut sharply the profitability rate for Peugeot and its local importer, Cotro said.
Peugeot’s LCV market share in SEE in 2010 was not bad, compared with the Europe-wide average which was 10.7%, he added.
“Our forecast for 2011 is for a market share of between 10% and 10.5%. The growth will be spread across the region but the main driver will be Romania where we expect to boost our market share to 5.6% this year.”
In the SEE region last year, the company’s top selling LCV model, a category that spans vehicles up to 3.5 tonnes in kerb weight, was the Boxer with 1,566 units. Slovenia was the vehicle’s biggest market in the region with 854 registrations, followed by Romania with 239.
The auto maker sees the LCV markets in Albania, Kosovo, Macedonia, Serbia, Montenegro, Bosnia, Bulgaria and Moldova as stable with no signs of recovery yet.
The outlook for the company’s performance in Serbia, Macedonia, Bosnia and Albania has been brightened by fleet procurement contracts it has won there.
In Slovenia, Peugeot’s LCV sales through February were stronger than expected, rising 45% on the year, whereas in Croatia the 30% yearly gain over the same period fell short of expectations.
Peugeot expects to sell this year 321 LCVs in Bulgaria, 605 in Romania, 470 in Croatia, 1,200 in Slovenia and a combined total of 800 LCVs in Albania, Kosovo, Macedonia, Serbia, Montenegro, Bosnia and Moldova.
Conditions on the LCV market were further compounded in the past year by the rising cost of raw materials which entails a rise in retail prices but at the same time vendors are under pressure to come up with attractively priced offers so that they could move their inventory, Cotro said.
In his view, extended warranty and maintenance services, replacement vehicle and long-term rental options are now mandatory customer inducements for LCV vendors seeking a competitive edge.
Peugeot refreshed its five-model LCV range three years ago so the first restyling touches are still two-three years away, Cotro said.