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North American Hybrid and Electric Truck Market
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North American Hybrid and Electric Truck Market

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Sandeep offers his insights on the growth opportunties presented by the emergence of te hybrid and electric commercial truck market.

Sandeep offers his insights on the growth opportunties presented by the emergence of te hybrid and electric commercial truck market.

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North American Hybrid and Electric Truck Market Presentation Transcript

  • 1. Class 6-8 Truck Hybrid Powertrain Systems Market Open for Business HTUF 2009 Atlanta Sandeep Kar Global Program Manager, Commercial Vehicle Research
  • 2. Consumer Research: Voice of your Customers Must Be Heard to Develop Winning Solutions Fleet Managers belonging to private and for-hire vocational and on-highway fleets will be instrumental in offering growth momentum to the hybrid powertrain systems market. It is time to listen to the VOICE of YOUR CUSTOMERS 2
  • 3. Highest Ranking Benefits of Powertrain Technologies: Clear and Present Demand for Hybrid Powertrain Technologies Highest Ranking Benefits of Powertrain Technologies (N=109) #1 ranking #2 ranking #3 ranking Fuel Efficiency 59% 17% 12% Reliability 17% 19% 18% Reduced Maintenance Requirement 5% 20% 22% Longer Lifecycle 5% 9% 10% Attractive Lifecycle Costs 6% 6% 10% Effectiveness Under All Operating Conditions 6% 8% Residual Value 6% 8% Hybrid Powertrain Technologies- Reduce Idling 6% 5% Offers Solutions But Poses Lower Weight Penalty 5% Challenges Too!! Low Level Emissions Acces to Powertrain Support Infrastructure Note: Proportions less than three not shown numerically in chart. 0% 20% 40% 60% 80% 100% Q: When purchasing powertrain technologies, please rank the top three benefits that are most important to your fleet from the following list below? Source: Frost & Sullivan 3
  • 4. Purchase Intentions of Powertrain Technologies: Hybrids Gaining Traction Among Fleet Managers Level of Purchase Intention Powertrain Technology (N=109) Active Passive (Are Considering) (Might Consider) No Interest Automatic/Automated Transmission 50% 42% 8% Selective-Catalytic Reduction (SCR) 39% 51% 9% Biodiesel 38% 57% 5% Compressed Natural Gas 15% 57% 28% Hybrid Trucks 24% 61% 16% Navigation Based Fuel Consumption 22% 66% 12% Optimization In January, 2009 85% of the top 100 fleet managers reported either active or passive interest in purchasing hybrid trucks However, amongst alternative powertrain technologies biodiesel emerged as a more preferred technology when compared to hybrid powertrain technology. Demand for hybrid trucks slowly but surely on the rise, especially in the current environment as diesel prices show promise of an increase and regulations get stronger. Source: Frost & Sullivan 4
  • 5. Issues Driving Commercial Truck Industry’s Adoption of Hybrid Powertrain Systems Market Development Fuel Economy Diesel Price Volatility, EPA, Aftertreatment Penalty Emissions Strengthening Regulatory Environment, Poor Green Image Idling Idling Emission and Noise Reduction Low Cost Power Requirement Lifecycle Cost Engine and Brake Wear and Conventional HD Trucks Maintenance Issues Hybrid HD Trucks Driver Retention Manual Transmissions, Noisy Driving Conditions, Hotel Power Truck Design Issues Power Assistance Requirement, Unoptimized Engine Operation Source: Frost & Sullivan 5
  • 6. Fuel Efficiency Enhancement of Class 6-8 Trucks Through A Combination of Modifications and Regulatory Support Class 6-8 Truck Fuel Efficiency Enhancement Lightweight Structural and Body Materials Low-viscosity Lubricants Advanced Smaller Electronic Air-Disc Brakes, Turbocharger Engine,Camless Controls and Regenerative Braking Engine Modulation Vehicle Geometry Aerodynamic Modifications Fuel Injection, Hybrid Reduced Engine Valve Actuation Improvements Powertrain Friction Reduced Trailer Gap Low Resistance Tires Automated/ Advanced Lighter Fuel Tank Automatic Auxiliary Thermal Transmission Power Unit Management Other Design Modifications Powertrain Systems Modifications for Hybrid Trucks Higher Lesser Optimum Loads Congestion Speed Regulatory Support 2007 2015 Source: Frost & Sullivan 6
  • 7. Hybrid Powertrain Systems Market: Convergence of Advanced Technologies, Creation of New Revenue Streams Class 6-8 Truck There are two broad categories of hybrid Hybrid Powertrain Class 6-8 trucks, based on the energy Systems Market storage system and the hybrid propulsive power delivery mechanism. These two Control and Electrical and categories are: Energy Power Hydraulic Storage • Electric Hybrids Systems Electronics Rotating Systems Systems • Hydraulic Hybrids Since most Class 6-8 trucks use diesel fuel, the hybrid trucks are referred as diesel- Batteries Control Electric Traction electric or diesel-hydraulic hybrids. Electronics Motors Class 6-8 truck hybrid powertrain systems market can be segmented into the following market segments: Power Hydraulic Ultracapacitors Pump- Energy storage systems market Electronics Motors Control and power electronics systems market Electric and hydraulic rotating systems Hydraulic Accumulator market Reservoir Source: Frost & Sullivan 7
  • 8. North American Countries and Broad Market Nuances Specific to Hybrid Truck Demand Absence of Cold Starting Significant Comprehensive and Operating Long-Haul Federal tax Reliability Incentives/Credits Truck Challenge Smaller Demand Market Perimeter Truckmakers and Fewer Incorporating Specialized Hybrid Fleets Powertrain Strengthening Systems Regulations (Emissions, Idling, Fuel- Increasing Efficiency) Comparatively Government Canada Vocational Higher Push Truck Fuel Prices and Proposed Demand Introduction of Incentives Absence of Comprehensive On-Highway Significantly Trucking Higher Focused Purchase Price Over-burdened Hybrid Compared to Service and Solutions Diesel Trucks Maintenance Infrastructure Cold-starting Issues in Extensive Northern Testing by U.S. Key End- User Groups Larger Market Perimeter and Greater Number of USA Attractive Specialized Increasing Truckmakers, Fuel Price Adoption Fleets Medium Duty Governments, and Volatility Incentives, Truck Demand End-Users Focusing and Tax Credits, and Production Extensively On Regulatory and Financing Green Pressures Technologies Source: Frost & Sullivan 8
  • 9. Total Class 6-8 Truck Hybrid Powertrain Systems Market: Market Drivers and Restraints (North America), 2008-2015 • Tectonic Changes in North American and Global Automotive Industry • Recent Fuel Price Volatility Expediting Development and Introduction • Government Incentives, Attractive Leasing Options, and High Degree of Marketing Impetus • Technology Evolution and Maturity Accelerating Original Equipment Market Adoption • OE Production Initiation Inducing Economies of Scale • Driver and Fleet Adaptability and Preference Catalyzing Rising Fleet Interest DRIVERS • Regulation Compliance Support Enabled by Hybrid Powertrain Systems Driving Demand • Rising Congestion in Urban Areas Favoring Utilization of Hybrid Trucks • Maintenance Cost Reduction Potential Promising Reduced Lifecycle Cost • Development of Comprehensive Supply Chain Supporting OE Market's Development Source: Frost & Sullivan • Steep Price Difference Between Hybrid and Conventional Trucks • Psychological Inertia of the Trucking Industry, Government, and OE Market • Fuel Price Decline and Economic Slowdown Deflating Consumer Interest • Inability to Fully Complement Class 8 Long-Haul Operations • Unestablished Performance, Technology Attributes, and Standardization • Battery-related Challenges Raising Concerns RESTRAINTS • Safety and Maintenance Issues Posing Acceptance Hurdles • Lack of Comprehensive Government Incentives in Canada • Form-Factor and Integration Issues • Sub-optimal Tier 1 and Truckmaker Involvement • Development of Alternative Fuel and Fully-electric Powertrain Technologies • Energy Footprint Conundrum Offering Fuel to Detractors of Hybrid Technologies Source: Frost & Sullivan 9
  • 10. Total Class 6-8 Truck Hybrid Powertrain Systems Market: Revenue Forecast (North America), 2005-2015 500 400 evenues ($ Million) 300 200 R AG % C .8 70 R 100 0 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Source: Frost & Sullivan • The North American Class 6-8 truck hybrid powertrain systems OE market, consisting of energy storage systems, control and power electronics systems, and electrical and hydraulic rotating systems, is expected to generate $406.8 million by 2015. • The hybrid powertrain systems market’s revenues will start showing robust growth rates post 2010, after the industry puts the EPA 2010 regulation compliance issues and the economic slowdown behind it. • A healthy compound annual growth rate of 70.8 percent reveals that this market offers lucrative growth opportunities to market participants in the medium-long term. 10
  • 11. Total Class 6-8 Truck Hybrid Powertrain Systems Market: Key Market Engineering Measurements, 2008 Measurement Name Measurement Trend Market age (2008) 2 Yrs Infancy Revenues (2008) $ 9.6 Million Increasing Potential revenues (2015) $ 406.8 Million --- Base year market growth rate (2008) 292.3% Increasing Forecast period market growth rate (2008-2015) 70.8% --- Hybrid truck production (2008) 0.6 Thousand Increasing Forecast period units growth rate (2008-2015) 81.8% --- Average Price: Diesel-Electric Hybrid Powertrain System/Module (2008) $ 15,976 Decreasing Average price: Hydraulic Hybrid Powertrain System/Module (2009) $ 7,440 Decreasing Average product development time 2 Yr -2.5 Yrs Decreasing Industry average R&D expenditure per System $ 1,918 Decreasing Market Concentration (Combined market share of top 3 competitors, 2008) 100 % Decreasing Competitors (Active market competitors in base year) 41 Increasing Degree of competition (Scale of 1 to 10: 1 being minimum) 7 Increasing Degree of technical change (Scale of 1 to 10: 1 being minimum) 8 Increasing Customer satisfaction (Scale of 1 to 10: 1 being minimum and 10 maximum) 7 Increasing Customer loyalty 7 Decreasing 11
  • 12. Class 6-8 Hybrid Truck Production: Hybrid Trucks to Set to Account for 8 Percent of Total Truck Production by 2015 Hybridization of North American Commercial Trucks (Class 6-8) : Production Volumes 8% of Truck and Market Shares of Major OEMs (2008-2015), Hybrid Power Source (2009-2012) Production Hybrid Production 39,400 Electric Hybrid 100 O thers 80.8% Hydraulic Hybrid 90 CAGR= Volvo/Mack- 11% 80 PACCAR 70 23% stallatio (%) 60 n Hybrid Production 600 50 PACCAR 27% 40 Navistar In 39% Navistar 30 62% 20 Daimler Daimler-11% 10 16% 2008 0 2015 2009 2010 2011 2012 Truck Design Issues Conventional HD Trucks Driver Retention Fuel- Idling Lifecycle Emissions Hybrid HD Trucks Economy Cost 12
  • 13. Energy Storage Systems: Batteries Will Store Energy in Vast Majority of Diesel Hybrids, 2005-2015 Source: Frost & Sullivan • Batteries will continue remaining the most widely installed energy storage system in Class 6-8 hybrid trucks. • Hydraulic energy storage systems will start experiencing OE market adoption in 2008. By 2015, 28.2 percent of all Class 6-8 trucks manufactured will feature hydraulic energy storage systems. • Ultracapacitors will be able to penetrate a very small portion of the total hybrid truck production over the 20012-2015 period. In 2015, 3.8 percent of all hybrid trucks manufactured will feature ultracapacitors. • Lithium-ion batteries will be the overwhelming choice for energy storage systems in Class 6-8 hybrid trucks. 13
  • 14. Industry Structure and OE Market Supply Chain: Interesting New Market Dynamics Underlining Need for Synergetic Relationships Consumers: Fleets and Owner Operators Truckmakers Aftermarket OEM Vertical System Integrators Integration Module Suppliers Captive Tier 0.5 Supplier Tier 1 System Suppliers Tier 2 Software Suppliers Component Suppliers Truck Manufacturers Module Suppliers/System Integrators Component Suppliers Energy Storage System Suppliers (Batteries, Ultracapacitors, Hydraulic Accumulators-Reservoirs) Electric Rotating Machines (Traction Motors, Hydraulic Pump Motors) Power and Control Electronics 14
  • 15. Pricing Analysis: Diminishing Upfront Cost Barriers for Potential Adopters 14000 • Steady price declines in the battery, hydraulics, 12000 ultracapacitors, control electronics, electric and hydraulic pump-motors. 10000 P rice ($) • Price growth expected in the power electronics systems 8000 market. 6000 • OEMs interested in gaining greater control of the power 4000 electronics market. 2000 • Overall price decline will be prodded by economies of scale 0 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 • Increasing market competition and competition from global suppliers will expedite price declines in the Batteries Ultracapacitors Hydraulic medium-long term. 4500 3500 4000 3000 Price Growth Opportunity 3500 2500 Price ($ ) Price ($) 3000 2000 2500 1500 2000 1000 1500 500 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Electric Traction Motors Hydraulic Pump Motors Control Electronics Power Electronics 15
  • 16. Total Class 6-8 Truck Hybrid Powertrain Systems Market - Technology Roadmaps (North America), 2005-2015 Fuel-Cell Alternative Fuel Engines- Biodiesel/CNG/LNG Peripheral Diesel Engines Smaller HP Diesel Engines Powertrain Integrated Starter Alternators Integrated Starter Alternator Damper Technologies Automatic Transmissions CVT/IVT Automated Transmissions Advanced Automated Power Splitting Transmissions Variable Geometry Turbochargers Chassis Regenerative Braking System Advanced Regen Braking System with Complimenting Axle and Air Disc Brake Technologies Hybrid Powertrain Efficiency Enhancement Embedded Software Power and Advanced Hierarchical Control Structure Control Insulated-gate Bi-polar Transistor Advanced IGBTs for High Voltage Power Management Electronics Advanced Permanent Magnet Motors/Generators DC/AC Motor Generators Advanced AC Motor/Generator Rotating Bent Axis Pumps Machines Axial Piston Pumps-Open Config Axial Piston Pump-Closed Config. Ultracapacitors Asymmetric Ultracapacitors Carbon Ultracapacitors Ceramic Ultracapacitors Energy Storage Hydraulic Accumulator/ Reservoir Light Weight, High Power & Energy Density Accumulator/ Reservoir Systems Li-ion Batteries Li-ion Batteries with Advanced Thermal Management NiMH Batteries Plug-in Hybrid Type Micro Hybrid Full Hybrids Mild Hybrid Hybrid Series/ Parallel Hybrid Configuration Series Hybrid Parallel Hybrid 2005 2010 2015 Source: Frost & Sullivan 16
  • 17. Key Market and Technology Trends and Resulting Competitive Factors for System Suppliers Key Competitive Factors • Continuing diesel price • Increasing Levels of volatility and growing fleet • Consumers “Waiting Incentivization (Govt. , • Efficiency interest stoking market and Watching” truckmakers, insurance, financial community) • Upfront and • Sub-optimal battery Lifecycle Cost • Upfront and lifecycle • Favorable regulatory manufacturing environment footprint (battery replacement) cost • Quality and barriers remain Reliability • More market pull than • Driver and technician truckmaker push shortage Robustness • and Attractive Form Factor • Class 8 line-haul market: • Warranty cost implications forcing truckmakers • Seamless holy grail Interfacing with the towards imposing stringent requirements on Tier 1 Truck makers • Power electronics market suppliers, inflating cost Hybrid Platform benefiting from rising system voltage • Safety Value • Scalable and • Power and Flexible Supply • Need for technology Energy Density Chain standardization and industry cooperation •Proximity with • 2012-2015: Industry on • Least pressure on existing energy Truck makers, Fast Track and distribution infrastructure Large Fleets, and favoring hybrids Policy Makers 17
  • 18. Electric Commercial Vehicle Market: Friend or Foe?? Best Fit for Electric Commercial Vehicles: Depot-based urban delivery fleets cover known routes (typically under 100 miles) and they return to base every night where they can be recharged Load GCW / GVW 1* Capacity Pure Electric (ton) (ton) Typical Application Attractiveness Without 3.5 1.5 Urban distribution Government funds EV do 7.5 4 Urban distribution not have a future, as 12 7.2 Urban distribution initial cost is very high 18 11 Inter Urban distribution 26 17 Long distance 40 25 Long distance Total of 18,929 units sold in 2016 from 1,982 units in 2010 at CAGR of 38% 18
  • 19. CALSTART Member Benefits Frost & Sullivan study entitled: North American Class 6-8 Truck Hybrid Powertrain Systems Market is available to CALSTART members at a discounted price. This study offers in-depth research, analysis, and forecasts of the North American market for Class 6-8 hybrid trucks, energy storage systems, power and control electronics, and electric and hydraulic rotating machines. For enquiries, please contact: Melanie Savage Member Services Manager CALSTART msavage@calstart.org 19
  • 20. Contact Details Sandeep Kar Sandeep Kar Global Program Manager, Global Program Manager, Commercial Vehicles Research Commercial Vehicles Research Direct: 416.490.7796 Direct: 416.490.7796 Fax: 416.490.1533 Fax: 416.490.1533 Email: sandeep.kar@frost.com Email: sandeep.kar@frost.com 20