analysis of platform strategies of major heavy-duty truck manufacturers
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Analysis of Platform Strategies of Major Heavy-duty Truck Manufacturers
Nearly One in Three Heavy-duty Trucks Manufactured in 2018 to Feature Platform Based Lineage
Ananth Srinivasan, Senior Research Analyst
Sandeep Kar, Global Director
Commercial Vehicle Research
27Nov, 2012
© 2012 Frost & Sullivan. All rights reserved. This document contains highly confidential information and is the sole property of
Frost & Sullivan. No part of it may be circulated, quoted, copied or otherwise reproduced without the written approval of Frost & Sullivan.
Today’s Presenters
Ananth Srinivasan
Senior Research Analyst
Commercial Vehicle Research
Frost & Sullivan
Experience base covers a wide range of sectors, leveraging long-standing working relationships with
Sandeep Kar
Global Director
Commercial Vehicle Research
Frost & Sullivan
10 years of global commercial vehicle technologies
and markets expertise, which include particular
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Source: Frost & Sullivan analysis..
leveraging long-standing working relationships with leading industry participants’ senior executives
• Functional expertise • Commercial vehicles
• Transmission systems• Safety systems• Comfort and Convenience
technologies • Business expertise
• Competitive analysis• Product portfolio, and market expansion
strategy• Go-to-market strategy
and markets expertise, which include particular
focus on areas such as:
• Global commercial vehicle industry growth
opportunities, and market penetration and
growth strategy development
• Advanced truck technologies- powertrain,
chassis, safety, telematics and regulation
compliance technologies
• Global research and consulting management,
global business development and team-
building, CXO level revenue and market share
growth strategy development
Why Know About This Today?Competitive Dynamics, Demand Shift in Favour Emerging Markets; Converging Preferences
and Regulations Emerge as Key Trends
1. Changing Competitive Environment
TRIAD OEMs looking to enter emerging markets
Indian and Chinese participants going global
2. Convergence of 4. Saturated demand in
27.6%
27.3%
63.8%
63.2%
8.6%
9.5%
0.0% 50.0% 100.0%
2010
2018 TRIAD
BRIC
RoW
Globalization is not an
14
Unit Production
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Region NOx (g/kWh)
Particulate(g/kWh)
NorthAmerica
0.27 0.013
EU 0.4 0.01
Japan 0.4 0.01
India 3.5 0.02
China 2 0.02
2. Convergence of legislative and
environmental regulations across regions
3. Customer preferences focused towards optimizing TCO
0
5
10
2008
2015-e
TCO
Product Quality
Comfort and Convenience
Regulatory Compliance
Duty Cycle Applicability
Service/ Networking
4. Saturated demand in TRIAD,
significant opportunities in BRIC
Globalization is not an option anymore; it is a
necessity.
2
3
Source: Frost & Sullivan analysis.
Long-term
Imp
act
of
Str
ate
gy o
n P
rofi
tab
ilit
y
Global service and distribution
Global product platforms with multi-regional branding within each segment
Common R&D, strong regional brands/partners, multiple product platforms
Vertical synergy between brands and across segments
Regional presence/ partners, localized
Su
sta
ined
Pro
fita
bili
ty Z
on
e
Su
sta
ined
Pro
fita
bili
ty Z
on
e
Current Industry ScenarioOEMs’ Desire to Move to Sustainable Profitability Zone with Regional Customization Flexibilities
and Synergy Across Different Regional Brands
Heavy-duty Truck Market: Impact of Platform Strategy on Globalization versus Profitability, Global, 2011
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F&S Analysis and RecommendationCurrent Industry Trend Expected Industry Movement
Very High
Impact of Strategy on Globalization
Medium
Short-term
Imp
act
of
Str
ate
gy o
n P
rofi
tab
ilit
y
High
and distribution network
multiple product platformspartners, localized product development
Daimler Group, Volvo Group, MAN SE Dongfeng Motor Corp, Ashok
Leyland
Scania AB ,IVECO, Navistar Inc, PACCAR
Inc, CNHTC, Beiqi Foton, TATA Motors
Source: Frost & Sullivan analysis.
Platform Strategy—Five Key Takeaways
There is no standard definition of platform in the global HD market
2Daimler, Volvo, MAN SE to emerge as global leaders in terms of platform-based
truck production and gain market penetration across different regions. Scania AB will
continue to be the industry pioneer in modularization.
1Platform-based production of 12 key global OEMs expected to more than double by
2018, contributing on average 30.0 percent of respective OEMs annual production
volumes.
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So
urc
e: F
rost &
Su
lliva
n a
na
lysis
.
continue to be the industry pioneer in modularization.
3Five BRIC-specific, global, platform-based models to be launched by 2016, and an
estimated 50.0 percent of total platform-based production to be in China and India.
4
BRIC OEMs to focus on MoU/JV/ relationships with EU/NA OEMs and major Tier-I
suppliers. India, China offer high OEM−supplier synergy opportunities in terms of
engine, transmission, advanced safety, electronics, and chassis technologies.
5
Industry moving toward consolidation of regional, brand-specific platforms into global,
multi-brand platforms. EU OEMs to emerge as leaders in terms of both technology
adoption and market penetration.
Definitions and Key Assumptions
A platform can be defined as “a single set of common design, engineering, and manufacturing elements shared between different products/ brands/ marquee within the same organization or between organizations.” Example: Howo A7 platform from CNHTC
A vehicle architecture can be defined as “the overall framework of a vehicle, which includes its chassis, suspension, engine, transmissions, cab and other systems. This essentially translates into the DNA of the vehicle and is responsible for the holistic performance characteristics of the vehicle.” Example: Cab-Over-Engine architecture
Platform
Architecture
Module
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A module can be defined as “a set of functional systems/subsystems that can be integrated into the vehicle platform to perform a set of functions.”
Example : Human−machine interfacing module
A system is “a combination of individual components integrated to perform a specific function.” A system can be tested for its performance characteristics with respect to the vehicle’s requirements. Example: Anti-lock braking system
Source: Frost & Sullivan analysis.
Component
A component is “an individual part that forms the elementary building block of a functional system.” Example: Crankshaft
Module
System
40
50
60
70
Beiqi Foton
Dongfeng Motor Corp.CNHTC
Ashok Leyland
TATA Motors
58 57
By 2018, 29 Global HD Truck Platforms are Expected, with Individual Regional Products Built
with up to 70% Localized Components
Heavy-duty Truck Market: Key Truck Platforms, Global, 2011 and 2018
OEMs whose global strategy was in early stages of execution in 2011 are expected to show more pronounced, platform-based product development as they expand geographically.
Nu
mb
er
of
Pla
tfo
rms (
Un
its)
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0
10
20
30
Observed no. of distinct platforms, 2011
Estimated no. of global platforms available,
2011
Observed no. of distinct platforms, 2018
Estimated no. of global platforms available,
2018
TATA Motors
Navistar Inc.
PACCAR Inc.
IVECO
Scania AB
MAN SE
Volvo Group
Daimler Group
2429
Note: All figures are rounded. The base year is 2011. Source: Frost & Sullivan analysis.
Nu
mb
er
of
Pla
tfo
rms (
Un
its)
Year
Note: Within the split Auman GTL, and MAN SITRAK platforms are accounted to both individual OEMs involved, but are counted only once for computing the total.
7
8
6
3
4
3
3
3
0 5 10
Daimler Group
Volvo Group
MAN SE
Scania AB
Observed no. of distinct platforms, 2011Estimated no. of global platforms available, 2011
OEM GroupKey Global Truck and Associated
Platforms Considered
Daimler GroupActros, Axor, Auman GTL (Foton-Daimler JV), BharatBenz
Volvo Group Volvo FM, FH, VE (Eicher-Volvo JV)
MAN SE TGM, SITRAK (CNHTC-MAN JV), CLA (MAN-Force JV)
Scania AB R, P, G series
Expected to Increase by 2018
Expected to stay at current level
Over 50.0 percent of Top 12 Global OEMs Expected to Increase Number of Global Platforms
by 2018; Asia Market Penetration Emerging as Key Strategic Rationale behind the Increase
Heavy-duty Truck Market: Key Truck Platforms, Global, 2011
Number of platforms (Units)
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2
7
6
6
4
5
3
3
3
1
2
3
2
1
2
1
1
Scania AB
IVECO
PACCAR Inc.
Navistar Inc.
TATA Motors
Ashok Leyland
CNHTC
Dongfeng Motor Corp.
Beiqi Foton
IVECO Stralis
PACCAR Inc. XF, LF (DAF Trucks N.V.)
Navistar Inc.9800, CT series (CAT-NC2partnership), MN (Mahindra Navistar brand)
TATA Motors Prima, Novus
Ashok Leyland U series
CNHTC Howo A7, SITRAK (CNHTC-MAN JV)
Dongfeng Motor Corp.
Tianlong
Beiqi Foton Auman GTL
Source: Frost & Sullivan analysis.
OE
M
7
8
6
7
6 6
5
7 7
5
7
6
5 5 55
6
7
8
9
Observed no. of distinct platforms, 2011
Estimated no. of global platforms available, 2011
Observed no. of distinct platforms, 2018
Estimated no. of global platforms available, 2018
Heavy-duty Truck Market: Key Truck Platforms by OEM, Global, 2011 and 2018
Average no. of distinct platforms, 2011 Average no. of global platforms, 2011
5.0
Leading OEMs Expected to Consolidate Regional Platforms and Launch New Multi-national
Platforms, Thereby Increasing the Number of Global Platforms Going Forward
Nu
mb
er
of
pla
tfo
rms (
Un
its)
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3
2
4
3 3
4
3 3 3
1
2
3
2
1
2
1 1
3
2
4
3
4
3
4
3
2
3 3
2
1
2 2 2
0
1
2
3
4
Daimler Group
Volvo Group
MAN SE Scania AB IVECO PACCAR Inc.
Navistar Inc.
TATA Motors
Ashok Leyland
CNHTC Dongfeng Motor Corp.
Beiqi Foton
2.2
Source: Frost & Sullivan analysis.
OEM
Nu
mb
er
of
pla
tfo
rms (
Un
its)
Region Daimler Group Volvo Group MAN SE Scania AB Outlook 2018
EU
Daimler: E,T,A,C-B,S,ELVolvo: E,T,A,C-B,S,ELMAN SE: E,T,A,C-B,S,ELScania: E,T,A,C-B,S,EL
NA
Daimler: E,A,ELVolvo: E, EL, S, AMAN SE:---Scania: ---
Daimler: E,T*,A,C-B,EL
Actros,
AxorFM, FH TGM R, P, G
Platform Strategy Outlook—Key Global OEMsWeighted Average Number of Global Platforms of Leading OEMs is Expected to Grow from
2.1 in 2011 to 2.6 in 2018
Heavy-duty Truck Market: Comparative Outlook of Key Platforms, Global, 2011 and 2018
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India
Daimler: E,T*,A,C-B,ELVolvo: E,EL,T*,C-B,S MAN SE: E,A,EL,C-BScania: E,T,C-B,EL,S
China
Daimler: E,T*, ELVolvo: E, T*, EL, C-BMAN SE: E, EL,C-B, AScania: E,T,C-B,EL,S
RoW
Daimler: E,C-B,EL,SVolvo: E,T*,ELMAN SE: E,C-B,ELScania: E,T,C-B,EL,S
Scenario, 2011
E, T, S, EL E, T, EL, E, A, C-B E,T,C-B,EL,S
BharatB
enz
Auman
GTL
VE CLA
SITRAK
Legend:E: Engine, T: Transmissions, A: Axles, C-B: Cab and body, S: Safety, EL: Electronics
T* : Indicative of variation in technology/module sharing w.r.t other regions 2011 2018
Source: Frost & Sullivan analysis.
Region IVECO Navistar Inc. TATA Motors CNHTC Outlook 2018
EU
IVECO: E, T, ELTATA: E,T, C-B,EL, SCNHTC: E,T,C-B, EL,A
NA
Navistar Inc., : E,T,C-B,EL
TATA Motors: E,T,A,C-B,EL,S
Stralis
Heavy-duty Truck Market: Comparative Outlook of Key Platforms, Global, 2011 and 2018
Platform Strategy Outlook—Key Global OEMs (continued)Weighted Average Number of Global Platforms of Leading OEMs is Expected to Grow from
2.1 in 2011 to 2.6 in 2018
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India
TATA Motors: E,T,A,C-B,EL,SNavistar Inc., : E, T, C-B
China
IVECO:E, T, EL, SNavistar Inc.,: E,C-B,EL,SCNHTC: E,T,A,C-B,S,EL
RoW
IVECO: E,T, ELNavistar Inc.,: E,T,A,C-B,EL,S TATA Motors: E,T,A, C-B,EL,SCNHTC: E,T,C-B,A,S,EL
Scenario, 2011
E E E,T,A E,T,C-B,EL
Legend: E: Engine, T: Transmissions, A: Axles, C-B: Cab and body, S: Safety, EL: Electronics 2011 2018
MN
CTGenlyon
Prima
Source: Frost & Sullivan analysis.
SITRAK
HowoA7
9800
• Platform-based production of key models (global and regional) expected to constitute 38.0 percent of total truck production by 2018
• Major contributors to this increase will be growth in India- and China-specific products, harmonization and sharing of technology platforms by European OEMs, and synergies emerging from joint ventures and mergers in the industry. This is expected to lead towards vertical integration for EU and NA OEMs and supplier dependencies for BRIC OEMs
By 2018, Platform-based Production to Account for More than One Third of Total Production
Volume of Key Global OEMs
Criteria 2011 Scenario 2018 Scenario
Global platform-basedmodels with more than 40K 3 7
Heavy-duty Truck Market: Platform-based Production Snapshot, Global, 2011 and 2018
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Source: Frost & Sullivan analysis.
models with more than 40K units production
3 7
No. of OEMs exceeding 40K units production across different regions (all modelsinclusive)
4 8
Share of global platforms to total production (all OEMs inclusive)
12.0% 14.0
%74.0%
16.0%
22.0%62.0
%
Platform-based production global models
Platform-based production regional models
Non-platform-based production
Modular Production System—Scania AB Case StudyStandardized Interfaces with Flexibility across Various Model Configurations Enable Scania AB to Modularize All Major Component Subsystems
• Standardized interfaces across product models
• Maximum flexibility, since parts fit together independent of model variations
Strategy
Doors, side walls, and few combination of components compose the three cab families
Number of Before After
Sheet metal components
1400~1450 350~400
Interiors 1750~1800 580~620
Cab – top 7 3
Cab – front 8 3Execution
P, G, R series cab
Heavy-duty Truck Market: Scania Cab Family Modularization Snapshot, 2011
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Strategy Cab – front 8 3
Cab – door 12 8
Windscreen 3 1
• Estimated 50.0 percent model-focused part reduction achieved
• 30.0−50.0 percent reduction in design and development cost estimated
• 10.0 percent manufacturing cost reduction, and 30.0 percent reduction in sales and service expenses
Problem
• Dynamic customer preferences, leading to high manufacturing costs
• Increasing inventory, and bill-of-materials on product portfolio expansion, resulting in high operational costs
Source: Scania and Frost & Sullivan analysis.
Execution
Results
Parameter Daimler Group
Volvo Group
MAN SE Scania AB Navistar Inc. TATA Motors
CNHTC
No. of global platforms 2011
4 3 3 3 3 2 2
Platformdescription
Actros,Axor, Auman GTL,BharatBenz
FM, FH, VE TGM, SITRAK,CLA
R, P, G series MN, CT series Prima, Novus SITRAK, HowoA7
Platform hub (production)
Europe, China, India
Europe, India Europe, China, India
Europe India, North America, Latin America
India, South Korea
China
Target market Europe, South Europe, South Europe, Asia Europe, South India, Asia India, Asia China, Asia
Comparative Analysis—Key Global OEMsParameters Representative of Global Platform Strategy and Future Outlook
No
te: In
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atio
n a
nd
ra
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ase
d o
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rost &
Su
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.
Heavy-duty Truck Market: Comparative Analysis of HD Truck Platforms by Key OEMs, Global, 2011
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Target market (sales)*
Europe, South America, Asia Pacific
Europe, South America, Asia Pacific
Europe, Asia Pacific, Latin America
Europe, SouthAmerica, China, India
India, AsiaPacific, Americas
India, Asia Pacific, Middle East, Africa
China, Asia Pacific, SouthAmerica
Approx. % of common systems across regions, 2011
35.0−40.0 30.0−40.0 25.0−30.0 55.0−60.0 20.0−25.0 30.0−40.0 10.0−15.0
Approx. % of common systems across regions, 2018
50.0−55.0 50.0−55.0 45.0−50.0 65.0−70.0 37.0−43.0 35.0−40.0 30.0−35.0
No. of global platforms 2018
4 3 4 3 3 2 2
F&S success potential rating of platform
4.4 4.2 4.2 4.0 3.6 3.3 3.6
1 52 3 4 1 52 3 4 1 52 3 4 1 52 3 4 1 52 3 4 1 52 3 4 1 52 3 4
No
te: In
form
atio
n a
nd
ra
tin
gs a
re b
ase
d o
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rost &
Su
lliva
n a
na
lysis
. A
ssu
mp
tio
ns li
ste
d in
th
e f
ollo
win
g s
lide
.
Source: Frost & Sullivan analysis.
Parameter Daimler Group
Volvo Group
MAN SE Scania AB Navistar Inc.
TATA Motors
CNHTC
Emission
compliance (best)
Euro 6, EPA 2010
EEV, EPA 2010
Euro 6, EPA 2010
Euro6 EPA 2010, Euro 4
Euro 4, Euro 5 protected
Euro 4
Base transmission type
AMT for EU, Manual for India and
China
AMT for EU, Manual for India
AMT for EU, Manual for India and
China
AMT and AT Manual Manual Manual, AMT
Comparative Analysis—Key Global OEMs (continued)Parameters Representative of Global Platform Strategy and Future Outlook
Heavy-duty Truck Market: Comparative Analysis of HD Truck Platforms by Key OEMs, Global, 2011
15NA53-18
China China
Supplieropportunity index
3.9 3.7 4 3.2 4.1 4.4 4.2
Note:• Only key global OEMs listed based on Frost & Sullivan assumptions.• Frost & Sullivan proprietary list of key factors and attributes considered for analysis of data. • Indices are representative and are for comparative purposes only.• Indices on scale of 1 to 5, with 1 being lowest, 5 being highest.• * is indicative of only the key target markets for sales of the respective model.
1 52 3 4 1 52 3 41 52 3 41 52 3 4 1 52 3 41 52 3 41 52 3 4
Source: Frost & Sullivan analysis.
Outlook for 2018Participants with Global Platform Portfolio, Strong Presence in Growth Markets, and Regional
Branding Expected to Sustain Profits Globally
6
7
8
9
10
Daimler Group
Volvo Group
MAN SENavistar Inc.
IVECO
Clear global strategy, strong product mix
Global strategy evolving, strong regional products
Size of bubble represents expected production volume attributable to platform-based HD truck models by 2018
Sought-after zone
Sustained profits, globally
Ove
rall
Glo
ba
l P
res
en
ce
In
de
x
Heavy-duty Truck Market: OEM Outlook Comparative Analysis, Global, 2018
16NA53-18
Expected Number of Global Platforms Available, 2011 Source: Frost & Sullivan analysis.
0
1
2
3
4
5
6
0 0.5 1 1.5 2 2.5 3 3.5 4 4.5 5
Scania AB
PACCAR Inc.
Dongfeng Motor Corp.
Beiqi Foton
IVECO
Ashok Leyland
TATA Motors
Profitable, only at
regional level
Ove
rall
Glo
ba
l P
res
en
ce
In
de
x
CNHTC
Contents
Section Slide Number
Executive Summary 4
Research Objective, Scope, Methodology and Background 25
Definitions and Segmentation 32
Vehicle Platform—Introduction 39
Megatrends and Industry Convergence Implications 50
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Market Dynamics—Global Heavy-duty Truck Market 53
Industry Forecasts 63
Platform Strategies of Major Global HCV OEMs 77
Comparative Analysis of Platform Strategy, Global Footprint, and Penetration Potential of Major Global HCV OEMs
120
Impact of OEMs’ Platform Strategy on Supplier Community 133
Conclusions and Strategic Recommendations 141
Appendix 151
Key OEM Groups Compared in this Study
The OEM groups compared in this study are as follows:
Group OEMs
Daimler GroupDaimler Trucks North America LLC, Daimler AG Commercial Vehicles Europe, Beijing Foton Daimler Automotive Co. Ltd, Daimler India Commercial Vehicles, Mitsubishi Fuso Truck Company Ltd.
Volvo GroupVolvo Trucks North America, Mack Trucks North America, Volvo Trucks Europe, Renault Trucks, UD Trucks, Volvo Trucks India, Eicher Volvo Commercial Vehicles
MAN SE MAN Truck & Bus Europe, MAN Latin America
Scania AB Scania AB Europe
18NA53-18
Source: Frost & Sullivan analysis.
Scania AB Scania AB Europe
IVECO IVECO, SAIC-IVECO Commercial Vehicles China
PACCAR Inc. Peterbilt Truck Company, Kenworth Truck Company, DAF Trucks N.V
Navistar, Inc. Navistar International, Mahindra Navistar Automotive Ltd.
TATA Motors TATA Motors Commercial Vehicle India, TATA Daewoo Commercial Vehicles
Ashok Leyland Ashok Leyland Trucks India
CNHTC China National Heavy Truck Company
Dongfeng Motor Corp. Dongfeng Trucks
Beiqi Foton Foton Trucks China
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For Additional Information
Ananth S.
Senior Research Analyst,
Automotive & Transportation
(9144) 6681.4175
ananths@frost.com
Jeannette Garcia
Corporate Communications
Automotive & Transportation
(210) 477-8427
Jeannette.garcia@frost.com
21NA53-18
Source: Frost & Sullivan analysis.
Sandeep Kar
Research Director, Commercial Vehicles
Automotive & Transportation
(001)416.490.7796
Sandeep.kar@frost.com
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