VAN and truck manufacturer Iveco is predicting a downturn in commercial vehicle sales in 2006 as the UK economy cools.

Chris Thorneycroft-Smith, Iveco’s newly-appointed managing director, said his prediction was not being pessimistic but realistic. He said: ‘The economy runes are less promising and the experts say that things will be harder. I don’t see a fall-out of the market 1990s style, thank goodness, but the reality is that demand has been moderating for some time now and we have to recognise that.’

Speaking at Iveco’s annual state-of-the nation address, Thorneycroft-Smith said 2005 had been an excellent year for the Italian firm, which sold more vehicles than at any time in its 30-year history, including 9,406 vans in the UK. He said: ‘For any company in this hard-fought sector, that is some achievement. It is a testament to the growing strength of the Iveco brand and to the efforts of our people and the improving perception of what we do at every level of the market.’

Thorneycroft-Smith reflected that vans were becoming more and more like cars in the way they are bought and sold. He said: ‘This is no surprise as the sector is dominated by car-orientated manufacturers – in fact we are the only truck and van-focused brand.

‘What is surprising is how vans have become almost a consumer product, a disposable product and something that is traded as a short-term commodity to fill a short-term need.

‘In the old days, vans were channelled to market in the tried and trusted way. Now everyone is looking for a slice of the action and the market is becoming increasingly com-plex with contract hire and leasing brokers, dealers, importers and non-franchised agents all actively targeting the end user.

‘And the internet is a new electronic channel that cuts out all the old personal contact that used to be so important.’

In the 3.5-tonne sector, Iveco’s sales rose by 5.7% last year while in the past 10 years, the heavy van sector has grown 150% to 144,561 units.

Thorneycroft-Smith said: ‘That’s an incredible leap. It has happened because new vans have never been so easy to get.

‘The market is characterised by manufacturer and retailer push, rather than market and operator pull, and today there are all kinds of schemes out there to try and get the product out on to the market.

‘Because fleets are now the dominant force, the number of actual purchasers has reduced dramatically as end users move their operations off balance sheet.

‘In making that move, they are being faced with an array of choices on vehicle funding and contract hire has established itself as the most straight-forward hassle-free alternative for them.’