Class 8 Truck Market In North America 2021-2026

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    INTRODUCTION

    North America has been an economic powerhouse for more than a century now. It has continued to be on top because US, Canada and Mexico are close-knit markets. This market has benefited from some disrupting innovations, the presence of skilled workers and a strong internal market. There is no other industry apart from trucking which has benefited more from NAFTA which came into effect 23 years ago. The truck manufacturers, fleet operators grew more than 4 times ever since this agreement got underway.

     

    Info Graphic: Class 8 Truck Market In North America

    Seamless freight movement is what fuels mega economies. In North America, more than 66% of the trade between the participating countries i.e US, Canada and Mexico happens via Trucks. Other modes of transportation like rail, air and pipeline cumulatively combined carry only the remaining 34% of the freight. Trucks also have a major role in multi-modal shipments, mostly providing  first and last mile connectivity to factories and warehouses.

     

    MARKET DYNAMICS

    Strength in manufacturing, growing retail sales, and a slowly improving housing market are the biggest drivers of the class 8 truck market. But, there are also a lot of headwinds. The fleet operators in North America have a tough job cut out on their hands. The industry is grappling with technician shortage, rising lifetime equipment ownership costs, driver shortage, upcoming GHG-2 emission and ELD mandate.

     

    As long-haul freight continues to reduce of late, there has been a growing list of trucking companies who are opting for lower Class trucks to get their goods delivered. With digitization of the supply chain, there has been a spurt in regionalisation of freight to fulfill orders in shorter times. Earlier,a truckload carrier would wait till the trailer reached its optimal capacity, now there is no time to wait. This is prompting small fleet operators, typically having 5-6 Class 8 tractors to move down a few classes and get more vehicles to augment their fleet size. This will act as a major challenge to this market.

     

    The sales for the first seven months in 2021 were a total of 128,376 units sold, an increase of 32.2% from the previous year’s 97,110 units sold. 

     

    The total number of units sold were 16,824 in July of 2021an increase of 16.3% from 14,462 units sold in the year 2020 for the same month. The majority shareholder Daimler Trucks subsidiary Freightliner sold 5,845 units with an increase of 34.7%. The Paccar group’s subsidiary Kenworth Truck sold 3,031 units and another subsidiary Peterbilt Motors sold 2,735 units with the combined share of 34.3% for Paccar.

     

    Volvo group’s subsidiary company, VTNA sold 888 units as compared to 1,416 units sold in 2020 experiencing a 37.3% decrease. However, another subsidiary Mack Trucks recorded an increase in the sales by 33.9% to 1,252 units sold as compared to the previous year.

     

    In the month of June, the number of units sold were 19,840 with a whopping increase from the 13,276 units sold in the previous year. 

     

    The highest number of units sold were in the month of March 22,031, after which the sales dropped and came to a bottom of less than 10,000 units sold in the month of may, increasing through june. 

     

    MARKET SEGMENTATION

    How is the class 8 truck market segmented

     

     

    Read : Class 8 truck market trends in detail

     

     

    COVID-19 IMPACT ON THE CLASS 8 TRUCK MARKET IN NORTH AMERICA

    The COVID-19 pandemic has caused many sectors in the industry to experience a decline in the manufacturing as well as sales activities; however, some sectors such as medical have flourished. The automotive sector has experienced a steady growth for some of the companies and sectors, the automotive market has grown consistently with growing demand for such vehicles. Some of the companies in this sector have suffered from the pandemic due to the lockdown and restrictions put in place in regards to the pandemic protocol across the globe.

     

    The pandemic has caused a disruption in the supply chain operations across the world causing companies to experience loss in revenue. For instance, the company Paccar reported a net revenue of $17,154 million in the year 2020 which was a significant decrease from the revenue as compared to the previous year which was $24,119 million in the year 2019. The decrease was attributed to less sales of trucks and other parts due to the COVID-19 pandemic.

     

    MARKET TRENDS

    • In July 2021, the three leading commercial vehicle manufacturers, the Volvo group, Traton group and the Daimler group signed an agreement to install and operate a high-performance public charging network for heavy duty battery electric long-haul trucks and coaches across Europe.
    • In July 2021, the Volvo Penta group started the production of electric drivelines for Rosenbauer, a leading fire cervical vehicle manufacturer to be incorporated in its new fire truck named Revolutionary Technology.
    • In June 2021, Volvo group’s subsidiary Mack Trucks announced the plans of the New York city’s department of sanitation to purchase seven Mack LR Electric truck refuse models to be operated across the city.
    • In June 2021, the company Peterbilt announced the availability of UltraLoft sleeper configuration for the model 567.
    • In April 2021, the company Volvo and Daimler Truck AG came into a joint venture to develop and produce hydrogen based fuel cells to be incorporated in long-haul heavy duty trucks.
    • In March 2021, the company Peterbilt launched an EV operating cost calculator for the prospective electric vehicle customers of the company.
    • In February 2021, the company Daimler Trucks North America (DTNA) announced that they will power the Freightliner eCascadia as well as the Freightliner eM2 with their proprietary Detroit  ePowertrain.
    • In February 2021, the company Peterbilt launched a new bold and aerodynamic highway flagship truck model 579.
    • Diesel powertrain has long dominated the trucking Industry as the most preferred propulsion choice. However, with the evolution of lithium-ion battery, mostly driven by the development of electric car market, electric trucks seem like the obvious next thing.
    • The idea of autonomous trucks is getting popular with every passing day but to some, it might seem far-fetched and that’s where the concept of truck platooning comes in. The idea of getting goods delivered by four trucks but utilizing only one driver is actually an irresistible proposition.
    • In 2017, the penetration of Collision mitigation system in Class 8 trucks in the US was around 26%, compared to less than 10% in 2014.The market leader, Daimler is seeing ADAS fitment rate of 63% in the 2018 Freightliner Cascadia
    • There is a growing amount of electrification in the powertrain of Class 8 trucks. There are a lot of applications where the trucks spend a bulk of their time on a fixed route(Ex- refuse collection) or being stationary(Ex-construction site). They are an ideal application for hybridization
    • The long haul class 8 trucks typically cruise at around ~1100 RPM at 65 mph but the future targets for the same speed are in the range of ~900 RPM. Engine downsizing, will be useful in every possible application if the downsized engine is making as much power and torque as it was making earlier, only with less fuel required now.

     

     

    COMPETITIVE LANDSCAPE

    The Class 8 truck market in North America is fairly consolidated with only 5 companies making up for complete pie. Daimler is the undoubted leader in the Class 8 truck North American Market. It has held the no 1 tag for more than a decade now. Freightliner has been the unanimous choice of fleet operators across North America ,as it is cheap to buy, easy to maintain and commands a reasonable resale price even after 5 years/400K miles on the odometer. The market leader is actively pursuing autonomous technology and truck platooning in Oregon. It has also stated that the first version of the truck platooning system will have two trucks with active steering capability for the rear truck. It is also keen on launching an autonomous system before 2020.

     

    Paccar announced a strategic partnership with Romeo Power Incorporation which is a leading battery technology company. In accordance with the agreement, the company will purchase Romeo’s battery packs as well as the battery management software to be used in heavy-duty battery electric Peterbilt 579 EV and Peterbilt 520 EV refuse trucks across North America. In January 2021, the company also signed an agreement with Aurora to develop, test and commercialise autonomous Peterbilt and Kenworth trucks. In accordance with the agreement the company will integrate Paccar’s autonomous vehicle platform with Aurora’s driver to enhance the safety and operational efficiency.

    Freightliner announced the investment worth $20 million for the Detroit manufacturing facility located in Michigan which will serve as the source to produce Detroit ePowertrain components. The company is a subsidiary of the Daimler group which recently released the second quarter results for the company with EUR 43.5 billion which increased from the year on year comparison to EUR 30.2 billion. The group recorded a sales of 736,400 vehicles which also increased from the previous year same quarter sales of 541,800 vehicles.

     

    Volvo Trucks in August 2021, announced the acquisition of JMC Heavy Duty Vehicle Co. which is a subsidiary of Jiangling Motors Co. for $123.66 million. The acquisition is to start the production of new heavy duty Volvo FH, Volvo FM and Volvo FMX trucks in Taiyuan, China. The company also released its second quarter financial report with a net increase in sales by 24% to $10.4 billion from the same quarter of previous year. The company’s subsidiary Volvo Penta has announced acquisition of ZEM, a manufacturer of battery systems as a part of the group’s electromobility initiatives. The company also signed an agreement to acquire 60% of Designwerk Technologies AG based in Switzerland to develop electromobility products and services.

     

    The company Navistar merged with the Traton group for approximately $3.7 billion, the  group will hold all the common shares of Navistar. Navistar also reported the second quarter results for the year 2021 with the net income of $163 million on revenue worth $2.2 billion. The company recorded a loss of $38 million as compared to the second quarter of the year 2021. The company in January 2021 also collaborated with General Motors as well as OneH2 to launch the hydrogen truck ecosystem.

     

     

    COMPANY PROFILES

    1. Paccar
    2. Freightliner
    3. Volvo North America 
    4. Peterbilt
    5. Cummins
    6. Mack
    7. International/Navistar

     

    THIS REPORT WILL ANSWER FOLLOWING QUESTIONS
    1. The market size (both volume and value) of Class 8 truck market in North America in 2021-2026 and every year in between?
    2. The impact of upcoming mandates on class 8 truck market.
    3. The market size and forecast segmented by end-use segments (Vocational and Line haul)
    4. The market size and forecast segmented by fuel type (Diesel and Natural gas)
    5. Market share of OEMs in both vocational and linehaul segments
    6. Future growth plans of Truck manufacturers
    7. Latest trends in all truck segments
    8. Will electric and autonomous class 8 trucks really happen?
    9. Will regional haul overshadow long haul?
    10. The impact of renegotiation of NAFTA on Class 8 truck market.

     

    1.     Scope of the report

    2.     Research methodology

    3.     List of abbreviations

    4.     Market in a Nutshell

    4.1. By Volume

    4.2. By Value

    5.     Executive Summary

    6.     Introduction

    6.1. Economy of North America

    6.1.1.     US Economy Outlook

    6.1.2.     Canada

    6.1.3.     Mexico

    6.2. Role of Trucks in  North American Economy

    6.3. Fleet Operators in North America

    6.4. Contract freight rates vs Spot freight rates

    6.5. Used Class 8 truck market in North America

    6.5.1.     Best-selling used class 8 trucks in North America

    6.6. Class 8 Truck sales in US, 2010-2016

    6.7. High Taxation policy on trucks in US

    6.8. About Suppliers to the Heavy Truck industry

    7.     Market Dynamics

    7.1.  Drivers

    7.1.1.     Growth in employment leading to higher consumer spending in US

    7.1.2.     Implementation of the electronic logging devices (ELD) mandate

    7.1.3.     Growth of Vocational segment

    7.1.4.     Strong dependency on trucks for freight movement

    7.2. Challenges

    7.2.1.     Customers moving down classes to get products tailored for their application

    7.2.2.     Intermodal freight to grow at expense of Truck freight

    7.2.3.     Driver shortage becoming even more acute

    7.2.4.     Efforts to renegotiate NAFTA Agreement

    7.3. Trends

    7.3.1.     Electric trucks inching closer to become a reality

    7.3.2.     Growing penetration of Air disc brakes

    7.3.3.     Growing vertical integration in OEMs for Engines and Axles

    7.3.4.     Growing Research on Truck platooning

    7.3.5.     Growing penetration of ADAS

    7.3.6.     Heavy Shift towards Automated Manual Transmission(AMT)

    7.3.7.     Powertrain electrification

    7.3.8.     New OEMs eying the market

    7.3.9.     Vocational truck trends

    7.3.10.   Engine Downsizing and Downspeeding

    8.     Market Size and Forecast, Segmentation by country 2021-2026

    8.1. Market Overview

    8.1.1.     Class 8 truck market in North America by country

    8.1.2.     Class 8 truck in North America, by Volume

    8.1.3.     Class 8 truck in North America, by Value

    8.2. Class 8 truck market in US

    8.3. Class 8 truck market in Canada

    8.4. Class 8 truck market in Mexico

    9.     Market Size and Forecast, Segmentation by fuel type 2021-2026

    9.1. Market overview

    9.2. Natural Gas

    9.3. Diesel

    10.    Market Size and Forecast, Segmentation by Application 2021-2026

    10.1. Market Overview

    10.2. Line Haul

    10.2.1. Longhaul

    10.2.2. Regional Haul

    10.3. Vocational

    11.    Competitive Landscape

    11.1. Market share by OEM

    11.2. Market share in Linehaul Application (By Brands)

    11.3. Market share in Vocational Application (By Brands)

    12.    Company Profiles

    12.1. Daimler Trucks North America

    12.2. Volvo Trucks North America

    12.3. PACCAR INC.

    12.4. Navistar International Corporation

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