Truck sales expected to grow this year
A hot start to truck sales in 2014 may slow down, but Frost & Sullivan doesn’t expect it to stop.
In its report, Overview of the Global Medium-Heavy Duty Truck Market in 2014, the agency says the sale of medium-heavy duty trucks, which stood at 2.76 million units in 2013, is expected to go up to 2.87 million units by the end of 2014. North American sales projections exceed 140,000 units in 2014. In comparison Frost & Sullivan expects Class 8 truck sales to total 258,000 vehicles.
“The market will experience introduction of several global engine platforms and at least 15 new truck models,” says Sandeep Kar, Global Director of Automotive & Transportation Research at Frost & Sullivan. “With a change in truck sale models from transactional to relational formats, the market is expected to see a rise in investments in multiplexing technologies that facilitate the integration of soft technologies in trucks. Soft technologies and service/maintenance based solutions will drive greater revenue opportunities for truck makers in coming years.”
Among the other predictions made in the report, Frost & Sullivan forecasts a change at the top of the global marketplace; saying Volvo, for the first time in history, will outsell Daimler, “which could unleash a massive competitive force from the German OEM that had prided itself as world’s biggest truck manufacturer,” the report says.
Diesel is expected to continue to dominate the global medium-heavy truck market – 97 percent of units that will be sold in 2014 are expected to run on diesel. Thus, truck original equipment manufacturers (OEMs) in developed and developing economies are concentrating efforts on rolling out diesel engines with improved fuel efficiency, power density, and emission reduction capabilities. At the same time, engine sizes are increasing in developing markets while developed markets are experiencing engine downsizing in the heavy-duty truck segment.
“While diesel retains its status as the industry’s de facto fuel, natural gas fueled trucks will account for roughly one percent of total medium-heavy truck sales this year,” Kar says.
In addition, truck OEMs are focusing on developing value trucks that are priced 30 percent lower than premium trucks and 15 to 20 percent higher than low-cost trucks. These trucks are already making inroads in markets such as China, India and Russia, and are anticipated to grow at a rapid rate over this year.
Although value trucks deliver better fuel economy, safety, comfort, convenience and lower total cost of ownership than low-cost trucks, the latter will continue to witness strong demand for the next 10 to 15 years, the report says.
“Truck OEMs are launching digital e-retailing initiatives, such as website-based sales optimization, integration of digital marketing within existing dealership models, off-shore digitization, and lead generation through predictive analytics to gain more touch points with truck buyers and influence their purchase decisions,” says Kar. “They are also looking to adopt new technologies that can reduce operating expenses, as this will help them expand their customer base globally.”
The report also forecasts a strengthening demand for quality used trucks.
“A noticeable trend in both developed and developing markets is the rising involvement of OEMs in this market,” the report says. “OEMs are realizing the need for greater integration of digitization in both new and used truck retailing in gaining more touch points with truck buyers and also for influencing their purchase decisions. Digital retailing initiatives by truck OEMs will range from website based sales optimization to an integration of digital marketing within existing dealership models and off-store digitization to lead generation through predictive analytics. Big data will enable several of these new retailing initiatives.”