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Aftermarket trends revealed to industry leaders at Futuroad CE0s Breakfast

Leading commercial vehicle trade exhibition, Futuroad, hosted a CEOs’ Breakfast at the Kyalami Grand Prix Circuit on 3 May, bringing together industry heavyweights for a thought-provoking discussion on the future of the commercial vehicle aftermarket. The event is one of a series of thought leadership breakfasts for the automotive sector hosted by Futuroad.

The breakfast, themed “Commercial Vehicle Aftermarket”, featured insights from industry experts including Craig Parker, Research Director for Frost & Sullivan Africa, Menzi Nkonyane, Senior Research Analyst, Automotive Insights, Truck & Bus; Research for S&P Global Mobility and Duane Newman, Partner at EY.

Commenting on the event, host Michael Dehn, Managing Director of Messe Frankfurt SA (organisers of Futuroad Expo) said: “The South African automotive industry is a powerhouse, contributing 4.9% to South Africa’s GDP and employing over 110,000 people. It’s a major export industry, and a key driver of innovation across Africa.”

Global perspectives

Drawing on data from the United States, Europe and China, Duane Newman described five trends in the automotive sector. He said there would be regulatory pressure, macroeconomic and inflationary deterrents, evolving societal expectations and tight labour markets to contend with. These would force commercial vehicle manufacturers to introduce low carbon emission technologies and optimise costs and capex. He pointed out, “The industry requires a proactive approach towards improving fleet profitability through technology, together with a focus on sustainability and collaboration to enable autonomous trucking.”

Menzi Nkonyane provided some insights into the challenges around truck and bus production. These included overcoming economic and structural obstacles, where navigating challenges such as sluggish economic growth and currency volatility will be essential. He said this could arise from election uncertainty, high interest rates, power cuts, and worsening logistics challenges.

Turning to a discussion on geopolitical disruptions, Nkonyane highlighted the impact on shipping. He said, “The recent conflict in the Middle East, the rerouting of maritime vessels, and the increase in shipping costs are additional factors that may contribute to higher production costs in the short term.”

Growth potential

Ending on a positive note, he added that, despite challenges in global competitiveness and high operating costs due to economic and structural obstacles, S&P Global Mobility forecast that the truck and bus assembly industry in South Africa would exceed 27,000 units by 2030. In 2024, 25 000 trucks and busses will be assembled in the country.

Following the thread of expansion, Craig Parker highlighted penetration around Telematics. He said it was expected to grow from 40% to 43% by 2025 and level off at 50% market dominance by 2028.

Parker also spoke about video safety solutions, pointing out that it was among the top trends in South Africa. Touching on the topic of industry convergence, Parker said the market had enormous potential for growth opportunities, evolving from many of the basic systems such as track and trace and stolen vehicle recovery.

Commenting on the event theme, Michael Dehn noted that the gathering had covered some of the most important trends, but also drew attention to some unanswered questions. He said, “We need to find effective and efficient ways to respond to the rollout and adoption of autonomous technologies in key markets, understand what this would demand of IT and engineering and map out how best to derive profit.

“We are thrilled to be at the cutting edge of trend knowledge and insights and look forward to hosting future events of the same distinction,” he concluded.

Futroad Expo 2024 takes place from 19 to 21 November at Nasrec Expo Centre in Johannesburg. For more information visit https://futuroad.za.messefrankfurt.com/johannesburg/en.html

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