Demographic and environmental trends are influencing the international truck market – competition from Asia is increasing

• There are six megatrends that are changing the truck industry and posing new challenges for manufacturers
• Urbanization and mega-cities demand new solutions for road freight
• Increasing environmental demands require alternative drive trucks – there is a trend toward "green fleets" in logistics companies
• Safer and more efficient on the road: Trucks will be more closely networked with one another and with logistics headquarters
• Growing competition: Asian manufacturers are increasingly pushing into emerging countries, as well as into Western industrial markets
• OEMs will have to form long-term alliances with local suppliers to cut costs and grow in new markets

There are six megatrends that will have a major impact on the global truck industry in the next 20 years. Increasing urbanization and the emergence of mega-cities are playing a leading role here, changing the main product flows and the demands on logistics. Global plans to reduce CO2 emissions are another major factor: truck manufacturers will increasingly have to switch to electric and hybrid drives to meet environmental demands. In addition, there will be strong competition from new suppliers – especially from Asia. The need to save costs to stay competitive will lead to new alliances between OEMs and suppliers to enable growth in emerging markets. These are the main findings of the Roland Berger Strategy Consultants study "Truck Transportation 2030".

"There will be some major changes in the truck industry in the coming years," says Norbert Dressler, Partner at Roland Berger Strategy Consultants. "Not only do manufacturers need to prepare for increasing competition, but demographic and environmental trends will also become increasingly important in the future."

Urbanization requires new logistics standards

The world population is expected to rise to 8.3 billion by 2030, with many living in so-called mega-cities, especially in emerging countries. "This means the logistics industry will need to change: logistics companies will need new truck models to cover increasingly long distances between warehouses and city centers," predicts Sebastian Gundermann, who co-authored the study. "This means that smaller, lighter long-haul trucks will become increasingly important for carrying goods into cities."

Plans to reduce CO2 emissions are another major factor. The transportation industry may be responsible for only around 20% of global CO2 emissions, but it, too, must do its part to reduce them significantly. Of the companies surveyed, 90% believe that quiet, efficient, zero-emission trucks are the future of the industry. "Western countries already have tight standards for efficiency and environmental pollution from trucks," explains Dressler. "These standards are now becoming more and more prevalent in emerging countries, too, and, in the long term, will help alternative drive trucks break through in the market."

Better networking boosts road safety

Road safety is also becoming an ever more important factor. As more and more goods are carried, and as cities get larger and traffic levels increase, roads will become more dangerous. Businesses from the triad markets, China and India thus see accident-free transport as a priority for the future. The truck supply industry and logistics companies see this as particularly important.

"Tight safety requirements on the roads will mean a boom for technologies that permit better vehicle networking," says Gundermann. "In the future, logistics companies will know in real time where their trucks are and if they have any problems. That will save a lot of time and costs."

Competition from Asia increasing

Although the global truck market is set to grow around 4% per year through 2020, two-thirds of the companies surveyed see increasing Asian competition as a real risk. Around 70% of the companies thus expect to see a stronger presence of Chinese and Indian truck manufacturers on the international market, and increased cost pressure. "It will be some years yet before Chinese and Indian manufacturers can compete with Western standards, but they are already well on their way to doing so," says Gundermann.

To counteract this trend, Western OEMs will thus increasingly need to form alliances with suppliers and other OEMs from emerging countries. "That's the only way they will be able to develop cost-effective solutions and keep growing in the emerging markets," Dressler concludes.