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April 25, 2013

Cascadia Evolution sales heat up

Here's the strangest thing. I'm sitting in a bar (that's NOT the strange part) in Cabo San Lucas looking at whales cavorting about 100 yards off the beach. It's 85 degrees and I’m the guest of Daimler. Two weeks ago, also the guest of Daimler but in a different guise as Mercedes-Benz, I was looking at caribou and freezing my ass of at -40 degrees in Coldfoot, Alaska. That's a temperature swing of 125 degrees.

Ask me which I prefer? It's a difficult decision. The beauty of Alaska's Denali Wilderness and its trees totally enveloped in snow and its roads pure sheets of ice is not to be dismissed. But the balmy breezes and whale sightings make Los Cabos would have to be my first choice.

The first event was to demonstrate how well Sprinter vans cope with the coldest extremes on the planet. Quite well, I can report. The second event was to talk about Freightliner’s success at home and abroad – like overtaking International in its previously unassailable position as medium-duty market leader and the drive for more exports. The Class 6/7 win is quite the accomplishment for Freightliner – never a player in medium-duty until it launched the Business Class in 1991.

Freightliner is after a much bigger share overseas, too. With its Vision 15, the company plans to go from a fairly small 4,000 units in export markets in 2010 to 15,000 in 2015. Its big successes to date are Australia and South Africa, where the cabover Argosy has become a firm fixture. In Australia, the recently launched Coronado 114 has made a big hit, according to Mark Lampert, sales senior vice president. Latin America, too, has strong potential, he says.

Down in Los Cabos at the very end of the Baja Peninsula, the Mexican market was obviously a topic for discussion and it was interesting to hear that Daimler Trucks regards Mexico as a major market comparable to the Brazilian juggernaut. Brazil, said Freightliner Mexico President and CEO Gerhardt Gross, is undoubtedly a huge target, but Mexico has a far greater potential with a faster economic growth and an average age for the truck population of 21 years.

What?

My comment was that there must be an almost limitless market for duct tape and bailing wire in Mexico. So the potential replacement truck market is enormous as the Mexican economy gains momentum. Gross says Mexico is seeking to shake its dependence on the U.S. economy, diversifying into other Latin American markets. But the reality is that it will be tied to the U.S. economy for at least two decades more and so it's important to Freightliner.

And Freightliner is important to Mexico, producing Class 8 Cascadia trucks in Saltillo, near Monterrey, and mediums alongside other Freightliner heavies in Santiago Tianguistenco, near Mexico City.

Mexico has been a strong Kenworth market with the KenMex local manufacturing and brand. But Freightliner also had a strong January, says Lampert, gaining a 44% share against Kenworth’s 46%.

Closer to home, Freightliner’s 2014 Cascadia Evolution is seeing strong representation in the product mix, says Lampert. This is the spec that debuted mid-2013 and by careful matching of components, it offers better than 5% fuel efficiency gains. The DT 12 automated Detroit transmission will add to these fuel savings through optimization of the powertrain.

Yes, there is an upcharge for the automated transmission, but it’s one that has a realistic payback in fuel savings. In fact, the purchase price of the vehicle these days represents only 15% of the total cost of ownership so the premium is relatively small.

Because of this, Daimler is anticipating a major swing to the Detroit DT 12, going from zero in 2012 with about 75% of Cascadia production currently Eaton manuals with a smattering of Eaton automateds to a position where Eaton manuals and Detroit DT 12s are running about the same with about 42% each. Allison will make up the rest. That may take something of a hit with the Eaton announcement of the Advantage Series, an overhaul for the old manuals

So what about those Sprinter vans in Alaska? Post to follow…

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