In 1990, IVECO acquired 100% of the shares of Spanish industrial company ENASA, and since then it has positioned itself as the sector leader. How has the company evolved since then?
ÁNGEL RODRÍGUEZ LAGUNILLA: Within IVECO, Spain is an important country; it is the second-most important country in terms of market. In addition, it is also important in terms of our industrial presence. We have two factories in Spain, one in Madrid and the other in Valladolid. In Valladolid, we manufacture our light vehicles, while the heavy vehicles are produced in Madrid. We have more than 4,000 workers in Spain. The company constantly invests to adapt to technological changes. We include all the technological updates in our manufacturing line. We want to be a sustainable business for all our partners.
RUGGERO MUGHINI: Having two plants in Spain is not only a matter of pride, but also a matter of responsibility because we have to position the brand in the right markets. This brand has the responsibility to be the market leader, a position we have maintained for many years.
IVECO exports around 90% of its production in Spain. What are your main markets?
ARL: Our main market is Europe, mainly Italy, France, and Germany. The UK market is more important for the Valladolid factory, compared to the one in Madrid. The Valladolid plant serves France, Germany, and the UK, while Madrid is the only factory for industrial vehicles in Europe for the group. We have other factories in Argentina, Brazil, South Africa, and Australia that manufacture heavy vehicles.
The factory in Valladolid received the Award for Best Company 4.0. What's the importance of digitalization for IVECO?
ARL: In terms of the digitalization of processes, and from an industrial point of view, in the next 10 years we will experience a radical change compared to what we have seen in the last 50 years. In the industry sector, the leap will be massive. IVECO started with this process several years ago. In 2019, we received an award from the Ministry of Industry as the best 4.0 industry. This year, we received another award for digitalization, which demonstrates the effort of IVECO to improve productive processes. The challenge is to find practical uses for new technological developments, which is not always easy. There are many developments in areas such as robotics, AI, and augmented reality, but sometimes it is difficult to find practical uses for them.
RM: Industrial digitalization is an extremely broad concept. We will also witness the digitalization of transport. Cars will evolve significantly, as will trucks. The same evolution that we have seen in mobile phones will take place in vehicles in the next 10 or 15 years. If we connect vehicles to the internet, they will gain access to additional services, allowing the transportation industry to be more efficient and productive. Now, our trucks can connect to the internet. We will have a network in Europe that will help our vehicles record a better performance.
What differentiates IVECO from its competitors?
RM: We clearly differentiate ourselves to have a complete range of alternative energy vehicles. We started with gas nearly 25 years ago where we are leaders of sales in this segment. Today, we are in deep of the develop of next generation vehicles; electric and hydrogen vehicles.
How has the pandemic impacted your operations?
ARL: The impact has been severe, and the first thing we did was to protect the health of our workers. When the state of emergency was declared in March 2020, we immediately decided to shut down our operations in our factories. We communicated with our workers what they had to do to stay safe and the conditions we had created to ensure the health of our workers. To sum it up, we put in place everything to prevent the spread of the virus. We are proud to say that none of our workers were infected within our plants.
RM: We launched a new truck, IVECO S-WAY in July 2019, and the figures we recorded in 1Q2020 were spectacular, and we had a great start to the year. Then, the pandemic occurred in March, and we sent all our workers to work from home. Some of our clients with trucks came to a halt, while demand for goods in supermarkets boomed. We maintained all our workshops opened in order to ensure the service to our customers. Workshops, however, were not deemed an essential industry, so we had to communicate with the authorities to modify the regulations and allow trucks workshops to operate. In the summer, things started to improve, and the market slightly recovered. We launched a campaign targeting customers with difficult circumstances, allowing them to start paying for the vehicle six months after they purchase it.
What were your financial results in 2020 compared to 2019?
RM: We gained market share in heavy vehicles. 2020 was not as successful as originally predicted, but it was not as bad as expected in March. Some 95% of our dealers ended the year with positive figures.
Can you elaborate the company's strategy in terms of sustainability?
ARL: For us, sustainability is part of our DNA. We started to develop vehicles in natural gas 25 years ago. In buses, we are pioneers in electric buses as part of our portfolio. Sustainability is essential for us. We signed a joint venture with US-based start-up Nikola to develop electric trucks. About 75% of the energy that IVECO consumes comes from renewable energies. We also have an important program to reduce CO2 emissions within our production process. We believe the entire production chain has to be sustainable.
Are you planning to present projects to the Next Generation funds from the EU?
ARL: Yes, we have done that. We presented some projects as part of the Next Generation initiative and are working with the authorities to develop these projects. We want to help the Spanish authorities make the industry more competitive. Spain is the second-largest manufacturer for automotive in Europe, and we have to create the conditions to ensure it remains competitive.
Can you talk about your hydrogen projects?
RM: The 2030 roadmap developed by the EU mandates all manufacturers to reduce gradually CO2 emissions till 30% in 2030. In order to reach that goal, the 20% of the vehicles will be either electric or hydrogen-powered. We, IVECO, will launch the first electric vehicle in 2022 and the hydrogen vehicle in 2023. Therefore, IVECO will be ready to carry out the roadmap assigned by the EU.
What are your goals for 2021?
ARL: The first priority is worker safety. We have to guarantee the health of our workers, and our perspectives are positive. We also want to maintain the industrial growth we have witnessed. If everything continues as usual, we might return to the results of 2019. We could even surpass the results of 2019. It is a year in which we are seeing a great deal of hope with the announcement of the European recovery funds.
RM: Our goal for 2021 is to be the leader in the sale of industrial vehicles in Spain.