Predicted Trends in the Light Commercial Vehicle Market For 2010

For most manufacturing firms 2009 has been a volatile year, large organisations that were once thought to be recession proof have been introducing large scale redundancies across-the-board. Although some European countries have already exited the recession, the UK remains firmly in the period of negative growth which constitutes a recession. Some analysts believe that the UK will not fully start to recover from this period of economic instability until at least the 3rd quarter of 2010.

So what does this mean for the UK Light commercial vehicle market (LCV) during 2010?

The sharp downward trend in LCV vehicles over the course of the last year will start to show signs of recovery during Q3/4 of next year as confidence in the sector increases. Positive growth in this sector will be slow and will probably not be likely until early 2011. Growth in the LCV sector is highly dependent on the recovery of other sectors including plumbing & heating, home improvements, vehicle repairs and the distribution and logistics sectors.

During the recession there has been a tendency for fleet owners / managers to concentrate on fleet maintenance in favour of purchasing new vehicles – this trend is likely to be reversed during the later part of 2010 as fleet managers look towards replacing aging vehicle fleets. Consequently the second-hand LCV market is likely to grow in size as ex-fleet vehicles are sold on.

In conclusion, the year ahead is set to see the start of recovery of all sectors not least the vehicle manufacturing industry which has suffered more than most. That being said recovery will be slow and is likely to continue into 2011.

Does China Hold the Key to the Electric Vehicle Market?

While US automotive giants and their more traditional Far Eastern counterparts continue to grab the headlines, with regards to electric vehicles, it seems the Chinese government is behind a major push across the country. There is growing optimism within China that electric vehicles will become commonplace across the world and as such hundreds of millions of dollars have been released by the Chinese authorities to encourage momentum in this market.

China targets 5 million electric vehicles by 2020

The fact that the Chinese government has promised to have 5 million EVs on the road by 2020, a government which very rarely make such predictions, has given great strength to those involved in the Chinese automobile industry. Indeed we recently saw the US authorities give the go-ahead for a takeover of the bankrupt A123 Systems by Wanxiang Group of China for a reputed $256 million. This was a company which had received in excess of $130 million in federal aid and was a groundbreaking developer of electric car batteries.

This move by the US authorities has given hope for the future amid signs that the two political powerhouses of the world may well be willing to work closer in the electric vehicle market. It is unclear exactly why the Chinese authorities have decided to put their weight behind the electric vehicle market this year, especially when you bear in mind relatively disappointing sales worldwide in 2012. However, speculation is rife!

Reducing dependence upon oil

The Chinese authorities have for many years now been reluctant to be overly dependent upon any mineral or any resources with oil taking centre stage. The government has clearly decided that moving towards an electric vehicle market will reduce this dependence upon the black gold and ultimately reduce the power and the hold which the US government has around the world. There are high hopes that this will kick start a new revolution for EVs around the world and indeed improved technology is the key.

It is difficult to say whether other governments around the world have been too short-term in their thinking about electric vehicles, leading to the vacuum of sales in 2012, or indeed whether they were only paying lip service and not investing all of the funds they had previously promised. The fact that the Chinese government is willing to take the lead and Chinese automobile companies are willing to take up the slack in the industry should prompt other governments and other automobile sectors around the world to follow suit.

Will 2013 be the year of the electric vehicle?

Time and time again experts have predicted that “this year” will be the tipping point for electric vehicles which will see them crash through into the mass market. While time and time again we have been disappointed, the market has faded and sales have been disappointing, perhaps the introduction of the Chinese government will be the much sought after tipping point.

Experts will be monitoring very closely sales of electric cars around the world during 2013. They will be monitoring the financial incentives offered by governments around the world although ultimately it will be down to consumers as to whether this really is the year of the electric vehicle.

Conclusion

It is unlikely that other governments around the world will want to be left in the wake of the Chinese authorities having promised 5 million electric vehicles on Chinese road by 2020. As a consequence, as opposed to improvements in short-term technology, battery power, etc it may well be the introduction of the Chinese authorities which finally pushes the EV into the mass market.