Supply-chain, transport and automotive company Super Group aims to extend its product offering into the commercial-vehicle market.
CEO Larry Lipschitz says the JSE-listed Super Group will, by mid-2008, introduce a long-distance freight-carrier range into the truck market, as well as a general-purpose product. Both will be procured from Chinese truck manufacturers.
Super Group currently offers another Chinese-made truck, the Power Star, to the local market, in cement mixer, tanker, tipper and freight-carrying configurations.
Lipschitz says the Power Star is benefiting from what he describes as the inability of competing truck suppliers to keep up with demand in the booming construction indus- try.
The Power Star is assembled from semi-knocked-down kits at the Super Group plant, in Pieter-maritzburg.
Lipschitz describes the Power Star as a no-bells-and-whistles product, which has been experiencing â€œgood demandâ€, especially as it is 30% to 40% cheaper than some competing trucks.
Lipschitz expects Super Groupâ€™s retail automotive-component division, Auto Zone, to also increasingly cash in on the lucrative vehicle market in the months ahead.
Despite new-vehicle sales taper- ing off from the all-time-high record set last year, Lipschitz anticipates the buoyant market achieved over the past four years to only filter through to the parts business as from this year.
This is due to high interest rates serving as motivation to consumers to maintain an existing vehicle, rather than buy a new one.
Adding to this is the fact that many vehicles bought over the last four years have reached the end of their set vehicle maintenance plans.
â€œWe anticipate a tidal wave of business to hit Auto Zone from this year on,â€ says Lipschitz.
The contribution of the auto- motive segment to Super Groupâ€™s trading profit has increased from 17% in the 2006 financial year to 21% at the end of the 2007 financial year.
Supply chain management dropped its share of trading profit from 39% in 2006 to 35% in 2007, fleet solutions decreased from 35% to 27%, and retail supply chain grew from 10% to 14%.
Super Group revenue for the 2007 financial year reached R11,6-bil- lion, operating profit stood at R941-million, and operating margins increased from 6,6% to 8,1%.
PUBLICATION: Engineering News
AUTHOR: Irma Venter
DATED: 21st September 2007