Truck & Bus Manufacturing

Truck & Bus Manufacturing

Brief Excerpt from Industry Overview Chapter:

Companies in this industry manufacturing heavy duty trucks including companies that manufacture and assemble heavy duty vehicles and buses. Major companies include Navistar and PACCAR (both based in the US), along with Dongfeng Motor and FAW (both based in China), Mercedes-Benz Group (Germany), Tata Motors (India), and Volvo Cars (Sweden).

COMPETITIVE LANDSCAPE

Heavy truck demand is driven by growth in the agriculture, manufacturing, construction, and retail sectors. Bus demand is driven by growth in the number of school-aged children and investment in public transportation systems. The profitability of individual companies depends on volume and sales of high-margin options. Large companies enjoy economies of scale in purchasing. Small manufacturers can compete by offering highly customized products. The US industry is highly concentrated: the top 20 companies account for more than 95% of revenue.

PRODUCTS, OPERATIONS & TECHNOLOGY

Trucks and buses can be classified by gross vehicle weight rating (GVWR), which measures the total allowable weight of fully-loaded vehicles. Generally, heavy-duty trucks account for about 40% of the industry's revenue, with heavy-duty trucks (33,001 pounds or more) accounting for about 25%. Other products include buses (25%), heavy-duty trucks (16,001 pounds to 19,500 pounds) accounts for about 10%, and firefighting vehicles (about 5%). Not included in this profile are light trucks (Classes 1-3), which range from small, light-duty pickup trucks designed primarily for the consumer market to commercial trucks with a GVWR up to 14,000 pounds.