Having captured the Large Van of the Year Award for the second year running, James Dallas hears how Iveco is working to attract retail buyers into the fold
Iveco’s Daily van retained the What Van? Large Van Award in 2016 to cement its position as the outstanding product in its class.
The mission now for the brand is to put it in front of enough people to further build up its presence in the retail market.
Ian Lumsden, Iveco UK’s director of Light Business line, which covers the Daily van, the manufacturer’s only product in the LCV market up to 3.5 tonnes, says the recognition the What Van? prize helps to put the Daily on customers’ radars.
“It makes people consider an Iveco Daily, rather than, say, a Mercedes [Sprinter],” he says.
Lumsden explains that as a rear-wheel drive model, the Sprinter is the Daily’s natural competitor, with both models noted for their ability to soak up the sort of punishment that would see other big vans wilt under the strain.
“It [the award] shows we’ve got a vehicle that measures up,” Lumsden adds.
Iveco is to open five more dealerships this year to take its total selling the Daily up to 65. Lumsden says the new additions are authorised repairers that the brand has persuaded to go into sales too.
He calculates that each outlet needs one salesperson who is able to shift at least 40 Daily vans a year. This would amount to a total of 2600 retail units to complement the big fleet deals with the likes of supermarket giants Tesco and Asda. All in all, the network employs a sales workforce of 150, but Lumsden insists Iveco does not want to buy market share through striking deals with rental companies.
While Lumsden says the hard graft the Daily vans on Tesco and Asda’s fleets put in should act as “a parts machine” for the workshops, he laments the new model’s reliability.
“Nothing’s breaking – it could kill us!” he jokes.
Lumsden acknowledges that Iveco cannot compete with the likes of Ford and Vauxhall when it comes to market exposure.
“We can’t get to the high street,” he says – unless the brand was to share dealerships with Fiat Professional (both manufacturers belong to the Fiat Group), but he admits no plans are afoot for this to happen.
With Iveco’s strong presence in the HGV sector, Lumsden points out: “We don’t look from 3.5 tonnes down, we look from 3.5 tonnes up.” Therefore, although Iveco’s sites can offer extended opening hours and out-of-hours servicing, they are not necessarily very accessible – particularly for owner-drivers, such as plumbers, electricians or painter/decorators who are more likely to plump for a manufacturer with a showroom in their local high street.
Where Iveco is succeeding, according to Lumsden, is in generating sales online – almost 80% in fact.
“We threw money at it last year,” he says.
Lumsden explains the manufacturer bought databases of van-using businesses in order to more accurately target customers, rather than, for example, spend the budget advertising on the radio.
“We can track customers more accurately by the web,” claims Lumsden.
He adds that Iveco is attracting SME and owner-driver buyers through offering retail packages, such as the Daily Platinum pack, which includes air-conditioning, satellite navigation, central locking and free servicing and warranty for three years. The brand is also offering 0% HP finance deals.
Lumsden says mid-size fleets of up to 500 vans are starting to look at ordering the Daily with the eight-speed Hi-matic automatic gearbox, but that retail customers tend to be put off by the £1500 premium over the manual gearbox.
One solution Iveco has adopted to this, says Lumsden, other than highlighting the savings on clutch replacements of using an auto, is by packaging the Hi-matic as a Daily International special edition model, with “better perceived value” and stronger residual values.
But Lumsden admits there is “some way to go” before retail customers choose the
Hi-matic as their default purchase. One business that has taken the plunge is organic food supplier Abel & Cole, which has taken delivery of 42 Daily chassis cabs, including 17 Hi-matic models.
Iveco now markets the Daily 4x4 in on-road as well as off-road guises and the former, launched 12 months ago, is now arriving in the UK. Lumsden cautiously reckons the brand will sell up to 300 units a year, but confesses “it is a bit of trip into the unknown”. He is more at home with the off-road derivative, which he describes as “a monster truck” that should hit 500 sales a year with customers including Network Rail.
Iveco, along with all LCV manufacturers, will move to Euro6 technology in time for the September cut-off point. It will reveal the Euro6 Daily at the CV Show in April. The model will feature some cosmetic tweaks, Lumsden says, but will essentially be the same as the 2014 Euro5 version.
Overall, Lumsden believes the new Daily’s quality has instilled faith in Iveco’s sales force. There is no sense that the model must be sold on price.
“We have changed perceptions,” he says.