Scania CEO sees Europe truck market shrinking 10 percent

Sat Jun 2, 2012 4:18pm EDT
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STOCKHOLM (Reuters) - Scania SCVb.ST Chief Executive Leif Ostling, who will leave the position to join the board of majority-owner Volkswagen (VOWG_p.DE: Quote), told Reuters on Saturday he expects the European truck market to shrink by about 10 percent this year.

He said truck markets had not changed much since Scania reported on its first quarter in April and his outlook for the European market, Scania's biggest, was in line with the drop forecast by Volvo (VOLVb.ST: Quote).

"It's tough still, in general and in Europe," he said. "We gave roughly the same figure as Volvo did for the European market. We haven't changed that (view)," Ostling said.

Last year, the total market for heavy trucks among 25 European Union countries plus Norway and Switzerland was 241,200 units.

Ostling predicted in April that the market would shrink to between 200,000 and 220,000 units this year as the euro zone crisis dampened demand in the highly cyclical heavy-duty truck business.

Earlier on Saturday, Volkswagen reasserted control over its wayward trucks brands with an extensive overhaul of senior management that included the appointment of Ostling. His job will be to push through a closer alliance between Scania and MAN Group (MANG.DE: Quote), also owned by the German carmaker.

"(My task will be) to coach the different co-operations and to urge on that sensible cooperations emerge between Scania, MAN and Volkswagen ... and make sure we reach results."

Scania and MAN have been holding talks on bringing their operations closer together.

"Within purchasing, development, and also within methodology within production and logistics there's a lot to do, first and foremost to learn from each other," Ostling said on Saturday.   Continued...

Chief Executive Officer Leif Ostling of Swedish truckmaker Scania talks to the media during a quarterly report presentation in Stockholm February 1, 2012. REUTERS/Bertil Ericson/Scanpix