Volvo, the world’s second-biggest truck maker, expects the European truck market to grow 5% in 2006 after 5-10% in the first half, chief executive Leif Johansson told Reuters on Friday.
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A strengthening of the overall economy in Europe and the prospect of tougher environmental regulations set to be implemented in October have led to an unexpectedly strong market for heavy trucks in the early months of 2006, Johansson reportedly said.
“Right now we are seeing a much stronger market than we expect for the full year,” Johansson told Reuters on the sidelines of a press event. “I am saying 5% (growth for the full year) and 5-10% (in the first half) as we see things now. But those 5-10% we see right now are before the introduction of euro 4 (emission rules) later this year which means that for the full year we end up at 5%.”
Reuters noted that Volvo’s earlier forecast for growth in Europe was 0-5% in 2006. Several truck markers have given evidence of rising market demand as customers opt to buy older, but cheaper, trucks ahead of the new EU-wide engine emission rules.
In North America, where a set of stricter environmental rules are set to be implemented at the turn of the year, demand had also been strong during the early months of this year, Johannson told the news agency.
Volvo’s outlook points to a rise in the overall truck market in North America to between 330,000 and 340,000 units this year from 320,000 in the previous year, Reuters said.
“In North America we are right now also at the upper end of the range,” Johansson said, according to the report.
