Australia’s leading seating suppliers discuss market conditions now and into the future
If there is one thing to be said about the future, you could at least say it’s inevitable.
The three major players in the Australian bus and coach seating market have differing views on the current and future state of play.
While one manufacturer says the growth in buses imported into Australia as completely built-up units (CBUs) has heavily impacted their business, another says the company’s good reputation has held them in good stead.
Traditional leaders in the supply of bus seats — McConnell Seats, Styleride and Transport Seating — each have differing views of what the future holds.
WORK HARD
McConnell Seats is undertaking a variety of internal initiatives to help combat the strain on the market caused by the significant growth in CBUs, according to the company’s General Manager, James Lowe.
He says despite the noticeable growth in imports, there is still room for local seating suppliers in the market.
“I think there will be consolidation in the market, as there has been.
“Obviously the mix of business might change. There are so many variables.”
Lowe says there has been a noticeable spike in imported buses with seats already in them.
“The production of fully built-up units is increasing,” he says.
“The more that buses come into the country with seats already in them means the local supplier doesn’t get access to that market.”
Lowe says McConnell Seats is undertaking a variety of initiatives to stay competitive in the marketplace.
“We’re looking at all facets of our business,” he says.
“We’re doing a lot of work internally on how we can become more efficient.
“We’re obviously trying to buy better from our suppliers.
“Our overreaching aim is to be efficient but also improve the quality of the product and the production.”
Lowe says it is difficult to predict what the future of the market holds, but is adamant there will always be a place for seating suppliers.
“It’s going to be competitive. That’s the bottom line,” he says.
“There’s always going to be an opportunity for local manufacturers for seating.”
SLOW BUT STEADY
A competing Australian manufacturer portrays an optimistic outlook, forecasting a long and prosperous future for bus and coach seating.
Styleride Director Noel Dabelstein predicts steady growth for the seating industry over the coming years.
Although growth in bus supply to the mining industry is coming to an end, Dabelstein says other aspects of bus and coach travel will remain and get stronger.
But he describes the current state of the market as “flat”.
“There’s no boom and there’s no bust, it’s just bubbling along.”
Dabelstein says Styleride hasn’t noticed any effect of an increase of imported CBUs.
“There’s been enough market for everybody to get a slice of it,” he says.
“We are addressing the global competition which is now in the Australian marketplace by being a global player ourselves.”
Dabelstein says as car travel becomes more expensive and inconvenient, it is likely public transport usage will increase.
“It will be a very healthy industry.”
He says school buses will always be needed, and coach and charter will probably feel the effects of the increasing tourism market.
“In the future, there’s going to be further expense and modernisation in the school transport fleet.
“Those buses will still be there.”
Dabelstein says the market has slowed down with the decline in demand for mining transport.
“Nobody’s ringing up and ordering 30 buses — that sort of business is gone,” he says.
“It’s going to be steady growth.”
Dabelstein says the company is importing seating components directly from overseas manufacturers to help keep costs competitive.
“We’re making a profit. We’re meeting our sales targets,” he says.
“All things in the market will probably see growth in the next five to 10 years.”
A SUNSET INDUSTRY?
In complete contrast, bus and marine seating supplier Transport Seating sees a bleak future.
Transport Seating Managing Director Rod Ferguson says the increased amount of completely built-up units coming into Australia is making a major impact on local seating companies.
“A lot of the buses are coming in with the seats already in them.”
Ferguson says the market conditions are looking dim for seating companies.
“It’s changed in the last 10 years, and it’s changed in the last 20 years,” he says.
“I can see the seating industry will find it very, very hard over the next five to 10 years.”
Transport Seating has undertaken a few initiatives to remain competitive in the market, including a licence agreement with manufacturer BCI.
“We sell the seats to BCI and they pay my royalty payments,” says Ferguson.
“It’s a win-win.”
The company also moved manufacturing to two factories in China about five years ago.
Ferguson says the future was once bright for seating companies, particularly around 1996.
“They were the good days. Those days are gone.
“We didn’t have to have a salesman, but now we’ve got to have a salesman to get out and chase the work.”
Despite contrasting views, Styleride, McConnell and Transport Seating appear to have a reasonably firm hold on the existing market, which Ferguson believes will make it harder for new suppliers to have an impact.
“We’re all established and we all know each other and we all get our share,” Ferguson says.
“It would be very hard for any outsider to make any headway.
“We’ve really got to be on the ball and times are getting tough.”