By Gilles Castonguay
MILAN--Iveco is offering to accept government bonds from
customers as a guarantee against the financing or leasing contracts
that they get from the Italian truck maker for the purchase of new
vehicles, the latest measure deployed by Iveco to adjust to a
crisis that has weakened demand for trucks across Europe.
"The project will have government bonds act as a guarantee for a
valid loan for the purchase of Iveco industrial or commercial
vehicles or for the drafting of leasing contracts," Iveco said
Friday. "It's an operation that coincides with the aim
of...offering customers more possibilities to access credit, so
that they will be able to face this particularly difficult
moment."
In a year in which Italy's economy is expected to shrink by more
than 2%, small- and medium-sized businesses are having greater
difficulty in getting financing as banks impose more stringent
requirements for loans.
A division of Fiat Industrial SpA (FI.MI), Iveco is the
fifth-biggest truck maker by market share in Europe's medium and
heavy segments, according to IHS Global Insight.
Iveco's offer comes about a month after it announced it was
willing to accept as downpayment for the purchase of its trucks any
credit that its customers had outstanding with the Italian
government. These credits are estimated to total billions of euros
for the goods and services provided to the public sector.
In the first quarter, its sales in western Europe, a region that
accounts for more than half of its total sales, fell 26.1% on the
year, mostly due to poor performances in Italy and Spain.
In a recent report, Barclays said it expected volumes in the
heavy truck segment to contract by 12% in Europe this year.
Fiat Industrial reports second-quarter results on Aug. 1.
Write to Gilles Castonguay at gilles.castonguay@dowjones.com
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