Last year's turmoil in the new car market caused by the confusion over pricing also caused the light commercial vehicle market to stall.
Peter Wyhinny, Volkswagen UK commercial vehicles manager, said problems were caused mainly by small businesses which delayed van purchases while waiting to see what might happen to prices.
“No-one buys vans at list price,” he said. “There are a number of offers and the transaction price level is competitive with parallel and grey imports.”
The confusion over pricing did not affect large fleet customers and the market ended the year up 3.8%. That was despite the non-fleet segment – typically sole traders predicted to be marginally down.
Mr Wyhinny said he did not expect a boom in 2001 but continuing marginal growth which was healthy. “If we have steady, sustainable growth of no more than 5% that means no fragility in the market which is what we are looking for.”
He said car-derived vans and the 3.5-tonne van were becoming increasingly popular while the 7-tonne mid-size van was being squeezed.
“A long-wheelbase, high roof, 3.5-tonne is almost as practical as a 7-tonne van. Since drivers now need an HGV licence for 7-tonnes, and there's a shortage of HGV drivers, companies are upgrading to 12-tonne, missing out the 7-tonne altogether.”
VW was benefiting from a strategy implemented two years ago “when we decided that if we were going to be serious about vans we had to have a proper strategy”.
There is now a full commercial vehicle team based at VW's UK headquarters in Milton Keynes consisting of sales, marketing and technicians. This was now replicated throughout the 90-strong CV dealer network.
Mr Wyhinny said VW had the “most improving loyalty rate” among its LCV customers. A recent new van buyer survey rated VW as the “fastest improving brand in retaining customers”.
Part of the strategy means that LCV dealers will operate independently where necessary with the degree of separation from car showrooms depending on the site.
About 70-75% of VW's LCV dealers have dedicated facilities, around 10% are part of a car dealership and 15% are still finalising plans.
Five outlets offer 24-hour servicing, which Mr Wyhinny thinks is particularly important with the growth of home delivery services. VW has won contracts with supermarket giants Tesco, Asda and Sainsbury where vans are working 8am-10pm. This meant they needed an overnight servicing facility, said Mr Wyhinny.
Dealers were also offering mobile servicing and quick-fit servicing.