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 measure the total allowable weight of fully-loaded vehicles. Generally medium and heavy-duty trucks include Class 4 (GVWR of 14,001 to 16,000 pounds), Class 5 (16,001 to 19,500 pounds), Class 6 (19,501 to 26,000 pounds), Class 7 (26,001 to 33,000 pounds), and Class 8 (GVWR of 33,000 pounds and over). Class 8 trucks account for about 50% of US industry revenue; class 4-7 trucks and buses each account for about 20%. Not included in this profile are light trucks (Classes 1-3), which range from small, light-duty pickup trucks designed primarily for...