Volvo 2012 Annual Report Download - page 48

A GLOBAL GROUP 2012 GROUP PERFORMANCE
Volvo strong on a weaker truck market
The South American market for heavy-duty
trucks decreased to approximately 146,000
trucks in 2012 compared to 148,000 the year
before. Brazil is the largest market by far in
South America and accounted for approximately
60% of the total market in the region. In 2012,
the Brazilian market decreased by 22% from
111,500 trucks to 87,400, impacted by the gen-
eral slowdown in the Brazilian economy during
the first nine months of 2012 and the transition
from Euro 3 emissions regulations to Euro 5.
During the fourth quarter demand picked up.
Lower financing rates for truck purchases, com-
bined with good customer profitability and the
positive outlook for economic recovery in 2013,
significantly improved demand. The total Brazil-
ian market for heavy-duty trucks is expected to
increase and reach a level of about 105,000
trucks in 2013.
The construction equipment market contin-
ued to grow during 2012, although the growth
rate slowed down during the year. In total, the
market increased by 6% in 2012 compared to
the strong 2011. Growth in the South Ameri-
can market for construction equipment is
expected to be in the range of minus 5% to
plus 5% during 2013.
The South American bus market weakened
during the year. During 2011, many operators
invested in buses with engines adapted to Euro
3 ahead of the changeover to Euro 5 on Janu-
ary 1, 2012, which entailed a price increase on
buses. Against that background, investments in
buses were fewer during 2012. In Brazil, the
market towards the end of the year was also
negatively affected by operators awaiting the
outcome of municipal elections. The total
heavy bus market in Brazil decreased by 9% to
4,400 buses (4,900). With a market share of
25% (23), Volvo is the second largest bus
brand in Brazil.
Increased market shares in
heavy-duty trucks in Brazil
Volvo reaped success in the Brazilian market, not
least with its new Euro 5 trucks. In the segment
for trucks above 16 tons in Brazil, the market
share increased to 18.2% compared with 17.1%
in 2011 and Volvo strengthened its position as
market leader. Volvo has gained market share
continuously in recent years. In 2010 the market
share was 14.8% and in 2009 it was 13.3%.
Within the segment for new Euro 5 trucks, Volvo
was the leader with 23.3% of the Brazilian mar-
ket. The Volvo Group is the market leader in
heavy-duty trucks also in Peru with the Volvo
brand and in Venezuela with the Mack brand.
Volvo Buses leading in Bus Rapid Transit
Volvo Buses is the world’s leading manufacturer
of high capacity buses and Bus Rapid Transit
(BRT) systems. During the year, deliveries started
for the contract of 688 bus chassis to Colombia’s
capital Bogotá, which was signed towards the end
of 2011. It was Volvo Buses largest contract ever
in Colombia. The contract covers conventional
buses, articulated buses and bi-articulated buses.
The new vehicles were sold for the third phase
expansion of Transmilenio in Bogotá, the conti-
nent’s most efficient and advanced BRT-system.
With its high capacity and fast transport, BRT is a
cost efficient alternative to rail-bound transport
systems.
Volvo CE expands in Brazil
Following a rapid rise in demand for SDLG
branded machines in Latin America Volvo CE is
investing USD 10 M to start manufacturing
SDLG excavators in its Pederneiras, Brazil plant.
In January 2013, Volvo CE also decided to
consolidate its production capacity in the Amer-
icas by relocating the manufacturing of Volvo
branded backhoe loaders from Tultitlan, Mexico
to Pederneiras.
After a very strong growth in 2011, the South American market
weakened during 2012, chiefly as an effect of a slowdown in the
Brazilian economy. Despite the slowdown the Volvo Group had
its second best year to date in terms of truck deliveries.
During the year, deliveries started of bus chassis to
be used in the third phase of Bogotá's public transport
system, Transmilenio.
DEVELOPMENT BY CONTINENT
Strengthened market position in Brazil
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