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MAN Truck balances sales slump in Saudi with buoyancy in Pakistan

As the prospects dwindle for a prompt recovery in the heavy commercial vehicles segment in the Gulf, MAN Truck & Bus Middle East hunkers down, while laying the groundwork for expansion overseas

Chinese labourers work to shore up a stretch of the Karakoram highway in the Hunza valley in northern Pakistan.
Chinese labourers work to shore up a stretch of the Karakoram highway in the Hunza valley in northern Pakistan.

MAN Truck & Bus Middle East is looking to counteract some of the effect of the ongoing slump in heavy commercial vehicles sales in the Gulf by seizing upon emerging opportunities in Pakistan.

“The Saudi Arabia heavy commercial vehicle market is really suffering,” shares Franz von Redwitz, MD for MAN Truck & Bus Middle East, noting that in 2016: “It went down roughly from 10,000 to 5,000 heavy commercial vehicles. Now it’s down 40% again year to date."

A year ago, von Redwitz spoke with optimism about prospects in Iran, but today he is more modest: “Iran is slowly picking up, following the elections. We all believe that Iran will stabilise, but it will take time – it will take much longer than many people have expected two years ago.”

Now, Pakistan has emerged as a market where von Redwitz and MAN Truck & Bus sees more opportunity, thanks in part to the heavy investment by China into the development of the China-Pakistan Economic Corridor.

He notes: “One country where we see a lot of stabilisation and economic growth is Pakistan. In the statistics, the rate of terror attacks and the death toll has reduced significantly.”

Sales are good, he says, and critically, MAN is currently the only Western company importing serious volumes of trucks into the market.

Von Redwitz adds: “There was previously a strong dominance by Hino, while the heavy commercial segment was very limited. But with the China-Pakistan economic corridor being built: with a new deep-sea harbour in Gwadar, and two more motorway routes through the country, modern vehicles are needed.”

The new frontier builds on strong brand recognition in the country, where MAN Diesel & Turbo Pakistan has long delivering diesel engines in the form of generators for use as primary power plants.

It remains early days, but von Redwitz points to an order book of 100 vehicles this year, and notes: “The Pakistanis like German technology a lot. It’s good business for us.”

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Construction Week - Issue 754
Nov 23, 2019