The light commercial vehicle market (lcv) - France

1.2 The Global Light Commercial Vehicle (LCV) Market

The global light commercial vehicle (***). After reaching its peak in ****, this market saw three continuous years of gradual decline. This market is in part driven by both Asian producers and consumers, who make up a significant part of both the segments. In this region LCVs are often used by companies as means of transportation for people but mostly goods/merchandise. * Asian manufactureres can be counted in the top ** with the rest being either American or European

Despite the COVID-** pandemic, this market can be expected to grow due to the increasing size of the logistics sector and higher number of global SMEs which require final delivery of a specific type and limited amount of goods. LCVs are also used as a transportation method and as the tourism industry seeks a comeback, the LVC market will seek to ride this wave.

Global Light Commercial Vehicle market World, ****-****, in billions of $ and # of vehicles sold in thousands Source: ****

In Europe, the countries with most of this type of vehicles are Spain (***) in Europe. 

  Countries with most registered LCVs in Europe Europe, ****, in thousands of units Source : Automobile Entreprise   

1.3 The Peaking French Market

France is the European country with the most light commercial vehicles in circulation registered, counting *.* million vehicles in **** which is around **% of the whole French motor vehicle fleet. Every year only *% of French LCVs are replaced, resulting in a very stable fleet. These type of vehicles age quite slowly, and **% of French LCVs are ** years or older. A light commercial vehicle is registered on average *.* times through its life, compared to *.* for heavy trucks and *.* times for tractors. The general purchasing tendencies are as follows: it is newly bought by professionals and after around *-* years sold to autoentrepreneurs (***). [***]. 

 The overwhelming majority of LCVs in France runs on diesel, followed by gas, while electric and hybrid powered LCVs represent a small minority. **** saw record breaking numbers in terms of new immatriculations, beating the previous high from ****, reaching a peak of ***.***, a *.*% increase from ****. The year **** recorded all-time highs for new immatriculations in a month (***)[***].

Type of LCV engine France, ****-****, in thousands of vehicles

Source: ****

The top three manufacturers of LCVs in France are all French companies being Renault, Peugeot and Citroën, respectively. These three companies have a national market share of almost **%, and have all seen both their ...

1.4 An important continental exporter

Overall, France exports more LCVs than it imoprts. However this was not the case right after the financial crisis of ****. In **** imports were still higher than exports, however by **** this trend was reversed. In that year *.* billion euros worth of LVCs were exoprted throughout the world with *.* billion euros imported. The following year the export figures were *.* billion euros compared to *.* billion euros of LCV imports.

Imports, exports and cover rate of LCVs France, ****-****, in billions and % Source: ****

 France is the first European exporter in terms of LCVs, with the biggest markets in terms of value being Germany (***) Leading destinations of LCV vehicles France, ****, in € million Source : CCFA  

1.5 The Impact of COVID-19

Very few markets were spared by economic effects of the COVID-** pandemic, the French LCV market was not one of them. After growing by a further *.*% in the month of January, lockdown started being enforced and with the decreased movement of goods and people this market was instantly hit. In **** France recorded the lowest number of new light commercial vehicle registrations since ****, barely passing ***.*** units, representing a **.*% decrease from the previous year. This is a trend that could also be observed in neighbouring European countries with Spain being the hardest hit at -**.*%, with Italy and Germany not faring well either at -**% and - **.*%, respectively. Overall in **** *.***.*** LCVs were sold in the EU, representing a **.*% decrease from the previous year. 

Comparison of annual LCV sales Europe, ****-****, in units sold Source: ****

Within France, however, it is not all negative regarding LCVs. Despite a significant decrease compared to ****, it was less affected than the passenger car market which saw losses of almost **%. The three biggest sellers from **** kept their places, despite recording average losses of **.*%. Renault headed the list with ***.*** units sold (***). No other company breached the **.*** units sold mark. 

LCV Manufacturers Sales France, ****-****, by units sold Source: ****

The reason ...

2.1 Short, working day urban trips, both in time and distance

When speaking of vehicle movement a trip is considered a one way movement between two points. The average trip for a light commercial vehicle in France is * hours, including loading and discharing. In fact, **% of these trips are inferior to ***km and **% are inferior to **km. The longest typology of trips both in terms of time and distance for LCVs in France are those regarding moving out of personal residences with an average distance of ***km and a trip duration of over * hours. LCVs transporting construction debris and household waste conduct shorter trips, with **% of these being below **km, but with a minimum average trip length of * hours. LCV trips that are conducted for the transportation of work personnel are shortest in terms of time and distance, with **km trips lasting a little less than * hour. Due to reduced economic activity over the weekend, light commercial vehicles perform **% of their trips in the period of Monday-Friday. During the week the average route length is **km, compared to **km over the weekend. From Monday to Friday *% of LCV trips are taken for personal reasons, while the figure increases to *% over the weekend

Light commercial vehicles in France are mainly used in urban ...

2.2 Seasonal ebbs and flows

The light commercial vehicle market is tightly intertwined with the logistics sector and it is crucial in the transportation goods. This market had been steadily growing in France for * years prior to **** and had seen important postitive month-to-month and year-to-year growth figures. There appears to be a correlation between LCV purchases and time of year. The anecdotal 'French summer', in which economic activity slows down, can be observed through the buying habits of LCV consumers. In the summer months there is a decided slowing down of business (***). The same phenomenon can be observed right before the winter holiday period, there is a marked decrease in LCV purchases which then rebounds during this period and through the new year.

Growth in car sales in respect to the same month, previous year France, ****-****, in % Source: ****

2.3 Île-de-France vs, a well known story

The map below illustrates the concentration of new registrations of light commercial vehicles in ****. The Île-de-France region dominates France with almost **.*** newly registered vehicles, a **.*% growth from the previous year. The region of Auvergne-Rhône-Alpes comes in second place with almost **.*** newly registered LCVs in ****, growing less than *% from ****. It is followed by Hauts-de-France with **.*** newly registered LCVs and Nouvelle-Aquitaine with **.***, both regions recording *.*% growth and -*.*% shrinkage respectively. Since LCVs are used for the transportation of goods, in large part by PMEs for specific types and amounts of products, it is perhaps unsurprising that there such a stark concentration near metropolitan areas such as Paris and Lyon. Being such a pivotal cog of the logistics sector it is understandable that LCVs are concentrated in densely populated areas.

Source: ****

Source: ****

Renting light commercial vehicles is a relatively new phenomenon. Ridesharing and daily rentals for personal purposes such as moving out, short distance travel or other exceptional circumstances are making the LCV market more accessible to more people, but still represent a tiny fraction of this market

2.4 Personal use, Construction and Commerce

Of the almost * million light commercial vehicles in circulation in France **% are employed for personal or artisanal use while **% are used by businesses, associations and administrations (***).

Purpose for the use of LCVs France, **** by % Source: ****

Purpose for the use of LCVs France, **** in ***s Source: ****

Over one quarter of the LCVs used for businesses are used for the transportation of foodstuffs. During an average week in France more than *.* million ligh commercial vehicles are in circulation on French roads, completing  more than ** million trips. A more precise breakdown of the reasons for LCV trips is the following

**% of trips serve the purpose of delivering services (***) **% of trips serve the purpose of delivering materials (***) **% of trips serve the purpose of delivering goods

Typology of use for LCVs France, **** by % Source: ****

The average stop for an LCV to discharge merchandise is ** minutes compared to ** minutes for heavy trucks [***]

2.5 Environmental regulation pressures

Over **% of light commercial vehicles in France use diesel as fuel, with gas, electric and hybrid cars making up a tiny share. In France, there is a vignette/sticker known as Crit'air which grades vehicular emission based on European environmental standards. Vehicles are ranked starting from green (***). Vehicles included in this certification include, cars, motorcycles, LCVs, trucks and buses. Under the law ****-*** from **** regarding the energy transition and green growth municipaltites can provide benefits to low emission vehicles.

In **** **.*% of LCVs in France were categorised under Crit'air *, **.*% under Crit'air * and **.*% as either Crit'air * or * (***). Only *.*% of all registered LCVs in France held either the Green or Crit'air * vignette.

LCV emission standards France, **** by %

3.1 The French love their own

France is the first European country in terms of usage and purchase of light commercial vehicles. There are currently around * million LCVs in circulation on French roads and hundreds of thousands are sold each year. These type of vehicles are vital to the French economy. Light commercial vehicles serve very specific purposes, particularly in the delivery of goods, and this cannot be replaced by other forms of transport (***). In France the average lifespan of an LCV is ** years and they are mainly used for the following activities :

Postal and delivery dispatch services Construction (***) 'Last-mile' delivery of goods to businesses Personnel transportation (***) Ambulant workshops Ambulances, fire department and police activity Ridesharing

In France, LCVs manufactured by French companies are by far the most popular. As mentioned above the three French companies Renault, Peugeot and Citroen hold over **% of the national market. When breaking down these numbers, * of the top ** of the LCV models that were the most sold in **** were by one of the aforementioned three manufacturers, with the most popular being Reunalt's Kangoo with **.*** units sold in ****. Despite overall sales in **** decreasing, this tendency reproduced itself once more.

Top LCV models sold France, ****, by %  

  Top ** LCV models sold France, ****, # of ...

3.2 Financing

In France, renting with the option to buy is by far the most popular scheme for buyers of light commercial vehicles that go through a financial institution to complete their purchase. In fact, in **** **.*% of people seeking financing to buy their LCV or industrial vehicle chose this option, followed by **.*% who decided to rent without the option to buy, while a tiny minority of *.*% settled on a classic credit scheme. This latter formula is in decline over the past few years.

Financing schemes for LCV and IV buyers going through financial institutions France, ****, by % Source: ****

In ****, payments of LCV and IV rentals with options to buy amounted to *.*** billion euros (***)

Year on year change per financing method for LCVs and IVs France, ****-****, in millions of euros Source: ****

3.3 Second-hand purchases

**** was a positive year for the second hand purchases of light commercial vehicles. A total of ***.*** second hand sales were recorded, an increase of *% from **** and the first time that the ***.*** mark was surpssed since ****. Unexpectedly, French brands continue to dominate these type of sales with over two thirds of transactions being of French made models (***). The month of December was particularly positve with **.*** sales, an increase of **.*% from ****.

Second hand LCV sales France, ****-**** in units Source: ****

In ****, second hand sales of LCVs that were less than * year old increased by **.*%, with a total of **.*** in ****. This was dominated by Citroën and Peugot, with **.*% and **.*% respectively. The sale of second hand LCVs that were between * and * years old increased by **.*% to **.*** units. * to * year old second hand LCV sales increased by **.*% while second hand sales of LCVs * years or older stagnated with growth of *.*%

4.1 Different shapes and sizes

 Light commercial vehicles are four-wheeled motor vehicles generally used for the carriage of goods. Light commercial vehicles do not surpass *.* tonnes of weight. This is a rather broad definition and many different types of vehicle models fall into this category. The most common are:

Van (***) Mini-van (***) Pick-up truck Mini-truck (***) Other (***)

In **** in France the top ** new light commercial vehicle models sold were either vans or mini-vans, following a global trend with SUVs and other *x* vehicles subsuming pick-ups and other types of vehicles, totalling ***.*** units. Of these, **.**% were mini-vans and **.**% were vans.

Typology of top ** new LCV models sold France, ****, by % Source: ****

Top ** new LCV models sold by typology France, ****, # of units Source: ****

As mentioned above, a light commercial vehicle can refer to multiple types of vehicles rather than just one. Whyle they can be categorised by typology/morphology, sellers and buyers often classify them through other units of measure. Since LCVs are often used for the transportation of goods, they can be grouped in terms of volume and they can range from as little as * m* up to **m*. Another important categorisation in maximum load capacity. Depending on the type of vehicle these vary, and intuitively, the higher the volume ...

4.2 Limited purchase options

The purchase of new light commercial vehicles in France is mainly restricted to two channels:

Directly from manufacturers (***) Other (***)

New LCV purchases in France predominantly take place directly from manufacturers, which is a historic tendency. Generally, LCV purchasers have a unique profile and need these types of vehicles for specific purposes, therefore there is an already established commercial network to complete these transactions. Over **% of purchases occur directly with manufacturing companies. Renault leads the way with over *** selling locations, followed by Citroën with *** and Peugeot with *** [***]

LCV sale points by company France, ****, in # of sale points Source: ****

4.3 LCVs going green

To adhere to past, present (***).

The FIAT Group is also heavily invested in this ecological transition. In fact, since the late ****s it proposes fully hybrid Dobló and Ducato models along side its more traditional models. The case is the same regarding FIAT's filial partner Iveco having introduced the Daily Natural Power van which runs completely on natural gas, which offers the same performance as a diesel motor while emitting *% less CO* and **% less nitrogen oxides (***).

The electric alternative is also a new trend that is being adopted by LCV manufacturers. After the Kanogoo ZE, Renault launched the fully electric Master in ****, the first large volume van of its kind. Ford followed Renault's lead by launching its own Transit Custom PHEV van, meaning plug-in hybrid vehicle, which has an electric motor but also runs on gas.

LCVs running on hydrogen are also starting to kick off with Renault again leading the way with their Kangoo ZE HY mini-van and Master ZE HY having the option to run on hydrogen for up to ***km.

Today all types of models from most manufacturers can be found that are hybrid, electric or run on hydrogen. Some of the most popular in France (***) are:

Mini-vans ...

4.4 Externalities: environment, noise, accidents, and traffic

In France, light commecial vehicles emit on average *.* times more green house gasses than heavy trucks. However average LCV emissions have been steadily decreasing. In fact, in *** LCVs emitted ***.*g of CO* per kilometer while today the figure is ***.*. The calculated environmental costs in France due to LCVs is estimated to be around *.* billion euros.  [***]

Noise pollution is a hazard and the fight against it is an imoprtant pubilc health challenge. According to recent calculations, then annual social cost related to sound pollution in France for the whole transporation sector os of almost ** billion euros, with serious ramifications for individual health but also for the economy. The transport of goods,of which LCVs plays an important part, is seen as harmful due to its noise emissions. These can be of two kinds: those coming from engines and exhausts and those coming from the friction of tyres on the road (***) help to significantly reduce this phenomenon. [***]

In **** in France LCV road accidents had a total of **** victims, of which *** deaths, and *** serously injured. The ratio of death per accident was *.*%, compared to *.*% for heavy trucks and *.*%. The number of light commerical vehicles involved in accidents was **** .The average trip distance per serous ...

5.1 Regulation

Commercial vehicles have a maximum weight of *.* tons or less. While private individuals can acquire this type of vehicle (***), they are more specifically intended for professionals, such as craftsmen or SMEs in general. While they retain the mechanical components of passenger cars, their monocoque structure is specific to accept larger volumes of cargo at the rear. [***]

Maximum weight 

The gross vehicle weight (***). It must not exceed the limit value of *,*** kg in any case.

Penalties for exceeding the GVW range from €*** for an overload of *** kg to €*** for each additional *** kg and until the vehicle is immobilized if the weight exceeds *% of the authorized weight (***), as well as the weight of the goods. [***]

Taxation

Like all commercial vehicles, LCVs benefit from advantageous taxation for professionals. The purchase allows the depreciation of the vehicle and the deduction of the taxable result. VAT is recovered on the purchase price, maintenance costs and fuel.

To protect the environment and limit pollutant emissions, a clean vehicle plan was introduced in ****. This program includes a tax credit for any taxpayer who bought or leased a clean vehicle. Professionals can benefit from this tax credit for any purchase or lease of a vehicle, including commercial vehicles, provided ...

5.2 European environmental norms

Euro-standards for heavy goods vehicles

Since the early ****s, several regulations have been made and implemented to combat the harmful impact of trucks on roads. Since ****, we have been talking about "Euro Standards". These standards impose limits on emissions of nitrogen oxides (***) and particles. As a result, pollutant emissions from vehicles with a gross vehicle weight of more than *.* tons are subject to increasingly stringent European standards, from "Euro *" in **** to "Euro VI" since January *, ****. Thus, all new heavy vehicles sold since this date must comply with the Euro VI standard. [***]

Light vehicles standards

For light vehicles, we are not talking about Euro standards but about grams of CO* emitted per kilometer. Since the *st of March of **** the French government has been applying the WLTP standard. WLTP stands for "Worldwide harmonized Light vehicles Test Procedure". This new device aims to report more accurately and realistically on the consumption and emissions of passenger cars (***). This WLTP cycle has a direct impact on the penalty scale and on the French people's wallet. [***]

The WLTP measures :

the fuel consumption of the vehicle (***) the range of the electric vehicle CO* emissions and other pollutants.

The WLTP imposes new rules on car manufacturers. Since the ...

6.1 Segmentation

• Fiat Ducato
• Volkswagen Group
• La Poste
• UPS
• Véolia Groupe
• Nissan
• Daimler Trucks and Buses (Mercedes)
• Stellantis (Groupe PSA et Fiat)
• PSA Peugeot Citroen
• Opel (Stellantis)
• Isuzu
• Fuso
• Piaggio
• Maxus (Saic)
• Seat (Vokswagen group)
• Skoda (Vokswagen Group)
• Goupil (Polaris Group)
• Liberty Electric Motion LEM
• Navya