Global Medium-Heavy Commercial Vehicle Market Outlook, 2019

2019 to be a Defining Year for the Evolution of New Business Models Around Electric Trucks and Digital Services

Global medium-duty (MD) and heavy-duty (HD) trucks sales grew 4.5% in 2018 from 2017 due to sustained growth in top truck markets of North America, China (Heavy duty truck sales stayed above 1 million mark), along with continual growth in India, Brazil, Russia, and Indonesia. In 2019, growth in North America, South America, Russia, India, Indonesia is expected to continue to be positive, while China, although over the 1 million mark in 2019, will be a smaller market than in 2018. However, speedy implementation of "Blue Sky" regulations, announced in July 2018, resulting in the rapid phasing out of 1 Million China III compliant trucks in 2019 itself can boost medium-heavy duty (MD-HD) truck sales in 2019.

Electric powertrain, autonomous driving, connected devices, and digital services continued to receive great interest (and investor dollars) in 2018 and are expected to continue to rise into 2019. While electric powertrains are beginning to be adopted in niche applications like refuse trucks where their total-cost-of-ownership (TCO) is already lower than diesel-powered counterparts, the TCO parity in other applications will take as much as 2025. Autonomous technology too while fast developing with technology giants like NVIDIA throwing their weight behind it combining with start-ups like tuSimple, drive.ai, and Embark, SAE Level4 autonomous is still a decade out. Telematics devices, however, are experiencing double-digit growth year-after-year including in TRIAD markets as well as China. By end of 2019, Among digital services, alongside the continued growth of telematics devices and services, digital freight brokerage solutions also received a huge boost with nearly $2.346 Billion invested across North America, South America, Europe, China, India, and Russia.

Although battery electric powertrains receive great attention in trade shows and new channels, natural gas (NG) is a quietly growing alternative powertrain option especially in Europe and China where there is great regulatory pressure to cut emissions. Even in North America, roll out of California air resource board's (CARB) ultra-low NOx regulations will propel NG adoption in MD-HD trucks since current diesel engines cannot meet the proposed NOx limits. While 2017 was a very good year for NG trucks in China since diesel cost 30% more than NG. Despite the fact that LNG truck cost about 60,000 yuan higher than a diesel truck, truck fleets estimated they could save about 3000 yuan per trip on backhauls and hence make good the extra cost within a year. However towards the end of 2017 government policy forced industrial power generation to switch from coal to NG, resulting in the increase of LNG price by 90% from $5.8 in August 2017 to $11 in January 2018. This resulted in China NG MD-HD truck sales crashing nearly 62% in 2018 to 34,267 units compared to 90,047 units in 2017.

Some of the key trends to watch out for in 2019 will be the proliferation of digital freight brokerage solutions, increased funding and employee base electric and autonomous driving solutions, alongside a slew of new product launches by truck OEMs which include Freightliner Cascadia Level 2 autonomous vehicle in North America as well as IVECO New Stralis NP460 LNG in Europe.

This study covers sales forecasts for 2019 and trends into 2025 across North America, South America, Europe, China, India, Russia, Next 11 and Rest of the World.

Key Issues Addressed

• What will be the size of the global truck market in 2019?
• Which truck markets are expected to grow in 2019 and which will contract? Why?
• What are some of the new product launches expected in 2019?
• What are some of the key trucking related trends in 2018's leading non-TRIAD markets- China, India, Indonesia, Malaysia?
• What are the key new technologies in powertrain, components, and soft technologies?
• What is the projected penetration of powertrain technologies across regions?