Business Fleet Africa March 2023

This month we cover a variety of topics, including all the news from Iveco, DP World, Hollard, JAC, Goodyear, Suzuki and many more. Regular topics include business advice from Standard Bank, a road safety update from Ashref Ismail and a deep dive into the Ctrack Transport and Freight Index.

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Business Fleet Africa

EDITION 23

MARCH 2023

26

29

Isuzu celebrates 10 years in

the lead.

TABLE OF CONTENTS

3 Editorial

Business

4 The 2023 Budget speed and the transport

industry

8 The SA logistics sector recovered omewhat

in January

Road Safety

6 The need for effective driver training of

company fleet drivers

News

12 Industry News

32 News

In the headlights: HCV Fleet Vehicles

14 Isuzu Truck celebrates 10th year in the lead

16 Volvo leads booming market for electric

trucks

18 Fuso celebrates 60th anniversary

20 Mercedes-Benz eSprinter is headed to SA

22 Why today’s city traffic is more challenging

for truck drivers

Supply Chain and Logistics

26 Logistics industry trends reshaping supply

chains

Fuel

28 Li-ion battery manufacturing outlook

29 The best usage for hydrogen ICE vehicles

Fleet Management

30 Prevention is better than cure

In the headlights: LCV Fleet Vehicles

36 BMW updates 3 series

37 Fiat enhances 500X range

38 Hyundai refreshes Palisade for 2023

39 Toyota Hilux line-up treated to key updates

40 Toyota expands Corolla Cross offering

Industry Sales

41 SA commercial vehicle market remains

positive

42 Buyers Guide

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Editor

Reuben van Niekerk

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082 837 8801

Editor-at-large

Suzanne Walker

suzanne.walker3@gmail.com

083 3789 664

Contributors

Roger Houghton

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082 371 9097

Publisher

Jacques Wilken

jwilken@mweb.co.za

083 299 7312

Supplement Editor

Tristan Wiggill

Tristan@businessfleetafrica.co.za

Advertising and Marketing

Charlene Kruger

charlene@businessfleetafrica.co.za

076 807 4613

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Disclaimer

While all reasonable precautions

have been taken to ensure the

accuracy of information supplied,

neither the editor, the proprietors,

nor the publishers can accept

responsibility for any inaccuracies,

damages, or injury which may arise

there from.

Government needs to step in

The proliferation of car guards and street vendors directing traffic

during loadshedding is a serious concern, and traffic authorities

must do more to ensure the proper flow of traffic during times

when traffic lights are not functioning. The Automobile Association (AA) agrees that

untrained pointsmen who direct traffic could be responsible for more harm than good and

should be discouraged from this practice.

While the intention is noble, and in many cases traffic does flow, it only takes one serious

accident to realise the folly of this endeavour. Since the pointsmen are not legally authorised

to perform this duty, there will be no legal recourse should something go wrong.

The Association says, however, that motorists have no choice but to comply with the

directions given in such circumstances because all drivers are following the instructions. “It

is impossible for one motorist to ignore these instructions as this would cause chaos when

other drivers are complying. This situation requires urgent intervention by traffic authorities

who, in many cases, are simply nowhere to be seen when traffic lights go down,” says the AA.

Loadshedding schedules are widely available, and traffic authorities should do more

to deploy personnel to those areas which carry the most traffic, specifically during peak

traffic times.

Some good news in the 2023 Budget Speech

During the 2023 National Budget recently presented by Finance Minister Enoch

Godongwana government acknowledged that constraints in logistics had negatively

affected economic growth and employment. Shocking is the fact that more than a quarter

of long-distance freight traffic has shifted onto the road in the past five years as a result of

severe deterioration of the freight rail network.

“This is due in large part to historical underinvestment in the network. Prolonged pow-

er failures and poor operational performance of transport industries continue to hamper

operations and investment in manufacturing, mining and agriculture. Several reforms are

under way to improve the performance of the transport sector, specifically freight rail and

to improve the capability of the state.” said Godongwana.

More important than the acknowledgement, was the invitation to the private sector to

get involved in a potential solution. Government is currently pursuing greater competition

in transport and logistics through third-party access to the freight rail sector which is now

in a pilot phase. In addition, several other reforms are in place to support recovery in the

transport sector.

It is great to see that the transport industry formed such a big part of this year’s budget

speech. We can now only hope that these measures are practically put in place because they

should have positive effect on the economy while also contributing to improved road safety.

Reuben van Niekerk

Editor

Editorial

EDITORIAL

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On 22 February, the Minister of Finance,

Enoch Godongwana, unveiled the

National Budget. The proposed budget

allocation aims to strike a balance

between national spending priorities

and limited resources.

Despite a wide variety of geopolitical

factors, South Africa’s economy grew

by an estimated 2.50% in 2022, which

was an improvement on the projected

figure of 1.9%. Real Gross Domestic

Product is projected to average 1.4%

between 2023 and 2025 and Stats SA

predict a 2.0% GDP projection for 2023.

As with the economy vehicle sales

showed better growth than expected,

outperforming the country’s GDP and

growing 19.3% year-on-year with the

retailing of 363 092 units compared to

the 304 341 of 2021.

The 2023 Budget speech focused

on the energy crisis, tax cuts for

households and businesses, increases in

various social services, including health,

education and various social grants and

the R903 billion earmarked for infra-

structure spending.

If the planned Eskom debt takeover

realises, business can look forward to

less load-shedding as the resources

which would have gone to servicing

debt will now be used to maintain the

Eskom infrastructure. This will hopefully

result in businesses spending less on

BUSINESS

The 2023 Budget speech

and the transport industry

‘The 2023 National

Budget made it clear

that in the short term,

all available additional

resources were being

utilised to mitigate

the impact of the

ongoing energy crisis,

and that means that

a variety of other

important initiatives

were unfortunately put

on the back burner.’

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running alternative energy solutions

such as fuel-powered generators.

The 25 percent rebate, up to

R15 000 for residential solar installa-

tions and the rebate guarantee scheme

for business bodes well for helping

South Africans cope with ongoing

power outages and rising energy costs.

In addition, zero increases in cor-

porate tax, personal income tax, VAT,

fuel levy and road accident fund levy

should significantly help ease cash flow

pressure on businesses.

The projected R903 billion to be

spent on infrastructure, including

roads, power plants and water supply

initiatives, is also welcomed.

“The 2023 National Budget made it

clear that in the short term, all available

additional resources were being utilised

to mitigate the impact of the ongoing

energy crisis, and that means that a va-

riety of other important initiatives were

unfortunately put on the back burner,”

says Derick de Vries, Executive Head of

Standard Bank Fleet Management.

The automotive industry was

collectively disappointed that no solid

commitment was made on the support

programme for the manufacturing of

New Energy Vehicles and New Energy

Vehicle components in the country.

The Minister did also not provide

any policy guarantees for the South

African automotive industry’s inevitable

transition. Delays with the promulga-

tion of the New Energy Vehicle White

Paper continue to represent one of the

biggest risks regarding the retention of

jobs and manufacturing contracts at

local vehicle production facilities.

“The future of the South African

automotive industry with regards to

local manufacturing will be based on

the ability to deliver the vehicles with

the drivetrains that the global market

demands going forward, and this can

only be done with the support of gov-

ernment, who needs to rubber stamp

the legislation needed to make the

manufacturing of new energy vehicles

viable,” adds de Vries.

The potential loss of local vehicle

manufacturing in any form will have a

massive impact on the South African

automotive industry in various ways,

including job losses. Another area that

will suffer greatly is vehicle pricing,

currently offset by the APDP import-ex-

port credit programme.

Increased vehicle prices, which are

already under pressure due to the

weakening exchange rate, will result

in increased transport costs across

the board. Along with increased new

vehicle prices comes increased service,

maintenance and insurance costs.

Increased new vehicle prices will

make it that much more difficult for

transporters to upgrade their fleets

when necessary and will lead to in-

creased maintenance costs as well as an

increased chance of vehicles falling into

an unroadworthy state and contributing

to our already grim accident and road

fatality numbers.

“While the strategies that are being

put in place to mitigate the fallout

of ongoing load shedding due to the

failure of Eskom are welcomed, it is

a pity that this must be at the cost of

other initiatives that are critically im-

portant to keeping the country’s wheels

turning,” concludes de Vries.

Standard Bank continues to offer

customers various innovative solutions

that help them utilise the vehicles

they need to run their business as

their needs and affordability change,

from traditional loan agreements to

a variety of fleet management and

leasing options that suit every need and

affordability case. BFA

ROAD SAFETY

Before writing this article, I was viewing

video footage of another horror crash

involving dozens of cars being destroyed

by a run-away side-tipper in KwaZulu

Natal. Studying the aftermath of the trail

of destruction left by the juggernaut

revealed that it was a sheer miracle

that there were no fatalities. However,

emergency services reported many

injured, some very seriously.

This follows a horror crash that

claimed the lives of 22 people in

Limpopo when a head-on collision

occurred between a mini-bus and a

cement mixer. Over the past weekend a

high-speed crash claimed the lives of an

MEC and his VIP bodyguard when they

crashed into some stray cattle in the

Free State.

Sadly, these are only the high profile,

major fatal crashes that are covered

by the media. Dozens more people are

killed daily on our roads in accidents

which go un-reported, and, in most cas-

es, these senseless deaths are avoidable.

Whenever the topic of advanced,

defensive driver training comes up with

my fleet clients, I’m often asked: “Why

do they need additional training, they

can drive – they have a license!”

For many companies, additional

driver training is seen as a waste of

time and money. I know of many fleet

companies which do not even screen

new-hires effectively. Most new recruits

are subjected to a quick drive around the

block alongside a “madala” driver before

the recruit is given the thumbs-up to get

behind the wheel of a rig costing millions

of rand.

It is only when there is a major crash

that owners start looking around for a

service provider for a quick fix.

For those contractors who provide

transport for certified and accredited

operators, defensive driving is not a lux-

ury, but a necessity. It forms part of the

policy and culture of the organisation

and is non-negotiable. These progres-

sive companies have recognised that

driver training is a small price to pay for

improved peace of mind. Driver training

is an investment, not an expense.

It is assumed that the holder of a

driving license can operate a vehicle of

that class. The reality is that with the

high levels of fraud and corruption at

license testing stations, many drivers

buy their licenses with the least amount

of training. The training is often inade-

quate and unprofessional with limited

exposure behind the wheel. The actual

driving experience commences when

they are offered a driving position at

your company, driving your vehicles in

peak traffic, carrying a heavy load.

A vehicle is a lethal weapon and driv-

ing is a hazardous occupation. Drivers

are exposed to much longer hours of

workplace risk than other employees.

Truth be told, a fleet driver is subjected

to greater hazards on the road than an

airline pilot. Yet we are happy to accept

mediocre driving standards, with limited

driver training.

The need for effective training

of company fleet drivers

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In some cases, we even applaud

drivers who break traffic rules to get

the deliveries done on time. This is a

recipe for disaster that could come back

to haunt company fleets that run their

operations on short-cuts.

Even seasoned drivers with years of

no-crash experience need to undergo

refresher training, as complacency and

bad habits set in, giving such drivers a

false sense of security, which could end

in disaster. Human beings are creatures

of habit who always default to the route

of least resistance which results in

carelessness and negligence and heaven

forbid, outright recklessness.

There are no prescripts in law that

govern advanced, defensive driver

training. However, there are many global

best practices that professional opera-

tors employ.

Here are some driver enhancement

best practices and guidelines from

professional operators;

Q Pre-hire screening is non-negotiable

and must be done professionally.

Drivers spend the bulk of their time

driving so they should be thoroughly

assessed in terms of driver attitude,

driving competence, legal compliance

as well as driving economically and

with mechanical sympathy.

Q New recruits should undergo a work-

shop on the contents of the compa-

ny’s transport and safety policy as

part of their induction process. They

must sign a pledge agreeing that they

understand, acknowledge and will

apply the various prescripts, a copy of

which should be filed with the Human

Resources department.

Q All new drivers should undergo a

certified advanced, defensive driving

skills course by an accredited service

provider with a track record for

reducing operational costs for their

clients. The course should cover,

amongst others, critical aspects

under the broader definitions of

driver fitness, vehicle fitness, loads

management, documentation and

importantly, managing hazards and

driving in adverse conditions.

Q The international best practice norm

suggests the following minimum

training cycles:

Q Abnormal loads and conveyance

of dangerous goods: minimum

every 12 months.

Q Passenger transport vehicles

(buses, mini-buses, scholar trans-

port, ride hailing, shuttle bus etc.):

minimum every 12 months.

Q Light delivery vans and cars:

minimum, every 24 months.

Q Delivery motor-cycles, every 12

months.

Q Driver monitoring and evaluation

should be integrated into the driving

environment. In this way, your top

drivers and those habitual offend-

ers at high risk can be identified

through your fleet management

system. Based on this information

appropriate action can then be taken,

such as monthly awards for the best

drivers and coaching for the bad

drivers. These interventions must

be recorded should it lead to formal

disciplinary measures for those who

fail to comply.

Q Ride alongs by supervisors and by

peers are an excellent way of getting

drivers to refresh and share safe

practices with each other, provided

they themselves have been taught

the correct way in the first place.

Drivers are not the only ones who

reap the benefits of continuous safe

driving practices through effective

driver training. The company will see a

definite reduction in offences, incidents

and casualties. Other benefits include

lower fuel costs, reduction in repairs

and maintenance and savings in time

and insurance costs, all of which should

result in a significant reduction in

operational costs.

A good driver is an asset to the com-

pany. Investing in their enhancement

leads to greater confidence, morale and

productivity which leads to a positive

image for your company. Not to mention

protecting the lives of other, innocent

road users, which is something that no

value can be attached to. BFA

Ashref Ismail is a multiple

award-winning road safety

practitioner with more than 35

years’ experience at provincial,

national and international levels.

He holds qualifications in Traffic

and Municipal Policing, Teaching,

Public Relations and Professional

Driving. He currently runs his own

fleet risk management consul-

tancy, specialising in advanced,

hazard management training and

driver wellness.

Following four consecutive months of

contraction, the South African logistics

sector as measured by the Ctrack

Transport and Freight Index recovered

considerably during January, though

off a low base. The Ctrack Transport

and Freight Index increased by 1.5% in

January following a monthly decline of

3.4% in December (and declines in the

preceding three months). On an annual

basis the Ctrack Transport and Freight

Index ended 2.1% higher than a year

earlier, a far cry from the annual growth

rate of 13.7% recorded in August 2022.

The sector has faced many headwinds

during 2022 and still finds itself in

recovery mode as we enter 2023.

The detrimental impact of the Transnet

strike on the logistics sector in the final

months of 2022 as well as the growing

voice of business decrying the dismal state

of the rail industry have, at last, resulted in

some attention from government. During

the 2023 National Budget presented by

Finance Minister Enoch Godongwana on

22 February 2023 government acknowl-

edged that constraints in logistics had

negatively affected economic growth

and employment. Quoting from the 2023

Budget Review document: “More than a

quarter of long-distance freight traffic has

shifted to roads in the past five years as a

result of severe deterioration in the freight

rail network.

This is due in large part to historical un-

derinvestment in the network. Prolonged

power failures and poor operational per-

formance of transport industries continue

to hamper operations and investment in

manufacturing, mining and agriculture.

Several reforms are under way to improve

the performance of the transport sector,

specifically freight rail and to improve the

capability of the state”.

More important than the acknowl-

edgement, was the invitation to the

private sector to get involved in a potential

solution. Government is currently pursuing

greater competition in transport and

logistics through third-party access to the

freight rail sector which is now in a pilot

phase. In addition, several other reforms

are in place to support recovery in the

transport sector, which were also pointed

out in the budget speech including;

Q The Economic Regulation of

Transport Bill, which will establish the

transport regulator, has been tabled

in Parliament.

Q Transnet is taking steps to improve

operations in key corridors, for

example software upgrades that will

increase efficiency through better

signalling.

Q Additional intervention in the form of

steps to prevent theft and vandalism

The South African logistics sector

recovered somewhat in January 2023

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TRANSPORT AND FREIGHT INDEX

Graph 1 Ctrack Transport and Freight Index % change on monthly basis

CTRACK

Jul-18

Jul-19

Jul-20

Jul-21

Jul-22

Jan-18

Jan-19

Jan-20

Jan-21

Jan-22

Oct-18

Oct-19

Oct-20

Oct-21

Oct-22

Jan-23

Apr-18

Apr-19

Apr-20

Apr-21

Apr-22

8%

6%

4%

2%

0%

-2%

-4%

-6%

-8%

-10%

Recovery Post Lockdown

KZN Looting

Covid 19 Hard-Lockdown

KZN Floods

Transnet Strike

-3.4%

1.5%

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and resolving legal challenges in

relation to locomotive procurement.

Q The operations and infrastructure

management functions of Transnet

Freight Rail are due to be separated

by October 2023, a step intended to

facilitate competition and improve

pricing.

Rail Freight was the worst performing

sub-sector of the Ctrack Transport and

Freight Index in 2022 and has been

underperforming for years, so steps

to address the sector’s challenges

are welcomed and if these steps are

implemented it could potentially be a

major boost for the logistics sector. The

Rail Freight component of the Ctrack

Transport and Freight Index declined by

26.3% year on year in January 2023, the

10th consecutive decline recorded.

“It is very heartening to see that the

transport industry formed such a big part of

this year’s budget speech. We can now only

hold thumbs that the proposed reforms

are put in place efficiently and effectively

as they are most certainly required for the

ongoing survival of many of the sectors of

the transport industry,” says Hein Jordt,

Chief Executive Officer of Ctrack Africa.

While the obvious beneficiary of the dis-

mal state of Rail Freight has been the Road

Freight sub-sector, the growing number

of heavy trucks on South African roads is

having a continued negative effect on the

quality of the road network and has accel-

erated the need for ongoing maintenance.

The additional allocation of R12.4bn in the

2023 National Budget for the rehabilitation

of provincial roads, to reduce the road

rehabilitation and strengthening backlog on

national roads is welcomed and will result in

spending on roads increasing from R61.8bn

in 2022/23 to R85.5bn in 2025/26. The

budget also noted that the South African

National Roads Agency Limited will increase

the length of the network in active mainte-

nance from 1 200 kilometres in 2022/23 to

2 400 kilometres in 2025/26, and the length

of the network in active strengthening to

600 kilometres by 2025/26.

The number of heavy trucks on both

the N3 and N4 toll routes increased in

January 2023 compared to a year ago,

while the Road Freight payload for the

country also continued to grow. This

is confirmed by the fact that the Road

Freight component of the Ctrack Transport

and Freight Index increased by 17.0% year

on year in January 2023, the 22nd straight

month of double-digit annual growth.

The Air Freight sector, which turned

out to be one of 2022’s star performers,

showed signs of moderation in January

2023. All the underlying components of the

Air Freight sub-sector declined on a month-

ly basis, including total consolidated airport

flight movements, which decreased by 1.9%

while cargo on planes decreased by 9.9%

in January. According to the International

Air Transport Association (IATA), the

lower demand for air cargo is now evident

across the globe, reflecting the multiple

headwinds facing the global economy and

spilling over to trading partner countries. Air

cargo tonne-kilometres (CTKs) to Africa was

down 10% year on year in January. The Air

Freight component of the Ctrack Transport

and Freight Index subsequently declined by

1.8% in January compared to the previous

month, but still grew by 4.6% compared to

the same period last year and 7.8% year on

year ending in December.

The Sea Freight component of the

Ctrack Transport and Freight Index

component declined by 9.8% in January

compared to a year ago but increased on a

monthly (9.6%) and quarterly basis (4.6%),

reflecting a hesitant recovery in Transnet

ports’ activities following the prolonged

strike in October 2022. However, container

Graph 2 Transnet freight rail volumes and train km

CTRACK, 2023 NATIONAL BUDGET

TFR Traffic (RHS)

TFR Volumes

2010/11

2011/12

2012/13

2013/14

2014/15

2015/16

2016/17

2017/18

2018/19

2019/20

2020/21

2021/22

230

220

210

200

190

180

170

55

50

45

40

35

30

25

Million tonnes

Million train km

Graph 3 Average daily coal trucks: Port of Durban and Richards Bay

CTRACK, 2023 NATIONAL BUDGET; 2022 DATAPOINT INCLUDES DATA UP TO OCT22

600

500

400

300

200

100

2020

2021

2022

2019

Daily trucks

To Port of Durban

To Port of Richards Bay

BUSINESS FLEET AFRICA | March 2023

10

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handling in the country remains 33.8%

below the September 2022 pre-strike

level. Cargo handling was also negatively

impacted by the strike and has only

partially recovered in the past few

months, confirming fears that it will take

the industry months to recover from the

crippling strike.

The Storage and Handling sub-sector of

the Ctrack Transport and Freight Index sec-

tor was under pressure for most of 2022,

with a trend of declining inventory levels

evident before the Transnet strike just

made matters worse. Storage and Handling

declined by 16.6% in January compared

to a year ago and declined on a monthly

(-3.8%) and quarterly basis (-11.7%).

The transport of liquid fuels via

Transnet Pipelines (TPL) increased strongly

in January 2023, with the pipeline compo-

nent of the Ctrack Transport and Freight

Index increasing by 6.1% on a monthly

basis, however, still tracking 2.1% lower

when compared to a year earlier.

Ctrack TFI and GDP growth

The December 2022 Ctrack Transport

and Freight Index (112.1) declined notably

compared to the September level (120.7),

signalling that the transport sector has

probably been a negative contributor to

economic growth in the fourth quarter

of 2022. The transport sector will most

likely underperform compared to some

of the other sectors of the economy, in

contrast to its outperformance during the

third quarter. The negative impact of the

prolonged Transnet strike put a damper

not only on the transport sector’s contri-

bution, but also the broader economy’s

performance during the fourth quarter,

given linkages to other sectors. This is

already evident in negative growth rates

recorded in the fourth quarter of last year

for both the mining and manufacturing

sectors, which are both heavily reliant

on the transport sector, and a consensus

view that the economy contracted on a

quarterly basis during the fourth quarter.

Over and above the strike’s impact, the

ongoing challenges of harsh load shedding,

the high costs of living, increased produc-

tion costs due to high fuel prices, rising

wage demands and elevated interest rates,

will continue to contribute to the country’s

dismal economic performance into 2023.

“The South African economy is in dire

need of a functioning logistics network

amid all the economic woes currently

plaguing our country and all stakeholders

should unite to address the obstacles

in the industry. From this point of view,

recent developments to address the sec-

tor’s challenges, as mentioned in the 2023

National Budget, is indeed a step forward

and welcomed,” concluded Jordt. BFA

Table 1 Change in Ctrack Transport and Freight Index in January 2023

Percentage change between

Rail

Road

Pipeline

Sea

Air

Storage and

handling

Ctrack Freight

Transport Index

January 2023 vs January 2022 (y/y)

–26.3%

17.0%

–2.1%

–9.8%

4.6%

–16.6%

2.1%

January 2023 vs December 2022 (m/m)

–3.2%

2.8%

6.1%

9.6%

–1.8%

–3.8%

1.5%

Quarter to January 2023 vs. Quarter to October 2022 (q/q)

–19.4%

0.9%

–0.8%

4.6%

0.8%

–11.7%

–3.5%

Note: The row highlighted in blue is the main Ctrack Transport and Freight Index values used.

Source: Ctrack and economistscoza, TNPA, StatsSA, SARS, N3 and N4 toll concessions, ACSA, ACOC, IATA.

Graph 4 Real GDP growth vs Ctrack TFI (q/q change)

STATSSA, CTRACK

20

15

10

-5

-10

-15

-20

Real GDP Growth

Ctrack TFI

201801

201901

202001

202101

202201

201803

201903

202003

202103

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