According to Sandeep Kar, global director, automotive & transportation research for Frost & Sullivan, light- and heavy-duty truck demand continues to see global growth while the medium-duty truck market is seeing a slight decline of market share.
Kar said 2.7 million medium- and heavy-duty trucks were sold globally in 2013. Based on China’s position as the top consumer, Kar said they will remain tops, but there will be increased growth for the North American market. By 2022, Frost & Sullivan predicts that number to reach 4.6 million trucks globally.
In terms of global demand for natural gas engines, Kar said 86.7 percent of medium- and heavy-duty trucks sold in 2022 would still run on diesel engine power, with 8.9 percent market share for natural gas. However, in North America, that natural gas penetration will reach 16.8 percent.
“From here on, the future will be more volatile,” said Kar. “Equipment cycle length has shrunk making it harder to predict.” He cited the fact that used and new truck sales, which are peaking at the same time in 2014, is a phenomenon illustrating this volatility.
From the widening of the Panama Canal, the shift of manufacturing back to the U.S., and lower energy costs are creating growth opportunities in the North American freight market, that promises increasing business for fleets, OEMs and industry suppliers.
By 2022, Kar said fleets operating in North America should expect an average annual operating cost of $183,000 – or $1.90 per mile – per truck, a 10 percent increase from 2013 costs. Fuel costs will make up 29 percent of expenses in 2022, compared to 33 percent in 2013.
Predictions for expenses include maintenance costs, which are forecasted to drop from 11 percent to 9 percent, due to more reliable power equipment, innovation in components and technological advances.
Kar said OEM engine penetration is growing, adding that warranty issues and residual value are influential in choosing new powertrain technology. On semi- and fully automatic transmissions, Kar expects 23 percent growth in the next equipment replacement cycle over the next six to 18 months. Meanwhile, engine displacement in North America continues to trend toward smaller engines.