All in all, 2011 has not been a bad year for the light commercial vehicle sector of industry, especially towards the tail end of the year.
Figures released by the Society of Motor Manufacturers and Traders report an overall increase in the registration of LCVs up by 16.7% overall for 2011. On the face of it, that’s a healthy increase and van manufacturers, the UK economy serving the traditional white van man and even van insurance providers will be basing their budgets for this section of the market accordingly.
However, if you drill down into that figure, there is a huge trend that could make a big difference to vehicle component manufacturers and commercial vehicle insurance brokers if they don’t build it into their calculations, based on the most recent figures comparing Dec ’10 sales to similar sectors in Dec ’11.
Of the smaller vans, three out of five sectors that make up the overall group of light commercial vehicle sales are actually down on last December’s figures.
Pickups came in 2.5% down, 4x4s more than an eighth less than this time last year, down 12.8% and vans in the <= 2.0t category were less popular by more than 4%.
The recorded rise for the sector overall, 7.8%, comes from the two larger sizes in this class, 2-2.5 ton and 2.5-3.5 ton capacities, which have shown 14.6% and 13.1% increases in registrations, respectively.
This is good news for the van insurance sector. Given that, typically, the larger the van the larger the premium, their income will have increased without having to do a tap, purely down to the choice of vehicle preferred by the tradesmen buying new.
But what does this shift in larger van registrations tell us?
Is the nature of British business changing shape, requiring larger capacity vehicles to transport goods? Or are UK businesses actually down-sizing their fleet, looking to fit more of their component into one vehicle than offer two delivery routes, in an attempt to cut down on fuel as well as the number of vans servicing their customer base?
With the anticipated rise of duty on fuel in August and the spiralling costs of van insurance, there is a very real argument for businesses to look at maintaining capacity by buying larger vans but reducing fleet and mileage by the number of visits to customers and suppliers as a method of cost-cutting. But what effect will these changes have on customer service? That is assuming that their customers have not seen downturns in their order-books, too?
The headlines can sometimes be misleading – it is what is written between the lines that is often more important that the text itself.