North American Trailer Technologies Market


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Concise summary of research findings from Frost & Sullivan's research focused on North American trailer technologies market

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North American Trailer Technologies Market

  1. 1. Strategic Analysis of North American Semi-Trailer Advanced Technology Markets Advanced Trailer Chassis, Safety, Aerodynamics, and Telematics Technologies To Generate Revenues Worth $3 Billion by 2018 North America Brief Summary NB03-18 July 2012
  2. 2. Contents Section Slide Numbers Executive Summary 4 Research Scope, Objectives, Methodology, and Background 15 Definitions and Segmentation 20 Mega Trends and Industry Convergence Implications 24 Total Market - • External Challenges: Drivers and Restraints 33 • Semi-Trailer Technologies Market Analysis 41 • Forecasts and Trends 77 • Market Share and Competitive Analysis 106 Conclusions and Future Outlook 109 Appendix 112 Key Company Profiles 116 Voice of Customer Research- U.S. Fleet Managers Desirability and Willingness to Pay for Advanced Truck and Trailer Technologies 135 NB03-18 2
  3. 3. Research Objective, Scope, Methodology and Background NB03-18 3
  4. 4. Research Scope & Objectives Base Year 2011 Study Period 2008 to 2020 Forecast Period 2012 to 2018 Vehicle Type Semi-trailers: dry van, reefer, flatbed, tankers Geographical Scope North America Semi-Trailer Technologies Market: Semi-trailer Production Unit Shipments, North America, 2012 - 2018 Year Unit Shipments (Annual) 2011 217000 2012 248200 2013 255500 2014 255200 2015 247000 2016 242000 2017 240500 2018 242100 Source: Frost & Sullivan analysis. NB03-18 4
  5. 5. Research Aims and Objectives Aim The aim of this study is to research, analyze, and forecast the North American semi-trailer production and technologies market. Objectives • Provide a strategic overview of the North American semi-trailer market. Including demand analysis, key technology trends, market trends, market drivers and restraints in each geographical region. • Determine market size and provide forecasts of trailer demand and breakdown by region. • Provide forecasts of penetration rate, unit shipment, revenue, and pricing analysis of major chassis (brakes, suspension and axles), safety systems (ABS, RSC, ATIS, TPMS, and etc), and Telematics technologies. • Competitor analysis: Analyze competitive factors, competitor market shares (OEMs), competitive benchmarking, and product portfolio analysis. Source: Frost & Sullivan research. NB03-18 5
  6. 6. Research Methodology Research Methodology: Frost & Sullivan’s research services are based on secondary and primary research data. Secondary Research: Extraction of information from existing reports and project material within the Frost & Sullivan database, to include data and information gathered form technical papers, specialized magazines, seminars and internet research. Primary Research: More than 10 interviews have been conducted over the phone by senior consultants/industry analysts with original equipment suppliers, regulation authorities and Tier 1 suppliers. Primary research has accounted for 80.0 percent of the total research. Semi-Trailer Technologies Market: Key Industry Participants, North America, 2012 Key OEMs Key Suppliers Wabash National Corporation Meritor Wabco Utility Trailer Manufacturing Meritor Great Dane Trailers Inc. Hendrickson Hyundai Translead Bendix Stoughton semi-trailers Haldex Source: Frost & Sullivan analysis. NB03-18 6
  7. 7. Key Questions this Study Will Answer Semi-Trailer Technologies Market: Key Questions This Study Will Answer, North American, 2012 What factors are impacting the North American semi-trailer technology markets? What is the growth potential for the North American semi-trailer technology markets? How will the changing trucking industry impact the semi-trailer market? What are the current technologies and product portfolios of key industry participants? What are the key market and technology trends for the semi-trailer industry? Source: Frost & Sullivan analysis. NB03-18 7
  8. 8. Definitions and Segmentation NB03-18 8
  9. 9. Study Definitions Geographic Scope This analysis will focus on the North American Market: • North America • United States of America and Canada Segmentation Scope The analysis will focus on the following applications: 1. Semi-trailer Market – OE 2. Semi-trailer Mechanical Systems Market – Brakes, Suspension, Axles, semi-trailer Aerodynamics 3. Semi-trailer Soft Technologies Market –Safety Systems and Telematics Definition of Unit(s): • All figures are represented by one single unit Definition of Prices: • All prices are reported at the first level of distribution from the supplier to semi-trailer OEM • Prices are reported in US Dollars Definition of Revenue: • Revenues are calculated based on the number of units and the price of a single unit Forecast Assumptions (North America): • Forecasts calculations are reported at the OEM level of distribution • Forecasts for unit shipment and revenue of semi-trailer components are calculated through using a weighted average of 2.15 axles per semi-trailer. Source: Frost & Sullivan analysis. NB03-18 9
  10. 10. Definition and Classification: Semi-Trailer Type Region North America Definition Dimensions A semi-trailer is used to transport freight. It has no front axle and must be coupled with a road tractor. In North America the majority of semisemi-trailers have two “tandem” axles, each with dual wheels. Name Common Types Maximum Width: 8.5 feet Maximum Height: 13.5 feet Most Common Length: 53 feet Maximum Gross Weight Limit: 80, 000 lbs Maximum Weight Per Tandem Axle: 34,000 lbs Maximum Weight Per Singe Axle: 20,000 lbs • Dry Van/Box • Refrigerated • Flatbed • Tanker Definition Dry Van/Box Dry van semi-trailers are the most prevalent type of semi-trailer used in the trucking industry and is frequently used to carry dry products such as boxed goods. Refrigerated (Reefer) Reefer semi-trailers are used to transport temperature critical freight such as produce. Reefer units rely on an external refrigerator unit and specialty temperature panels that keep the semi-trailer cold at all times. Flatbed Flatbed semi-trailers are used primarily to transport heavy cargo such as heavy machinery and construction materials. Flatbed semi-trailers must strap their freight down as it only consists of a load floor and removable side rails. Tanker Tankers are used to transport gases and liquefied freight such as crude oil. The size and volume for tanker capacities vary widely as it typically ranges from 5,500 to 9,000 gallons. Source: Frost & Sullivan analysis. NB03-18 10
  11. 11. Executive Summary NB03-18 11
  12. 12. Executive Summary—Key Findings The Next Generation of Advanced Semi-Trailer Design has been Set into Motion 1 The proliferation of advanced semi-trailer technologies will be driven by three crucial factors: strengthening regulatory environment, rising fuel prices, and an aging trailer population 2 Average age of semi-trailers in operation is 8.5 years with the market currently entering into its replacement cycle as production is expected to reach 248,200 units in 2012. 3 Total revenues for the advanced semi-trailer technologies market is projected to be $ 2.16 Billion dollars in 2012. 4 The significant impact of CARB’s mandate could result in the widespread adoption of semi-trailer aerodynamics as market penetration is forecasted to reach 56 percent by 2018 5 The strict standards of CSA 2010 is stimulating the interest in safety systems such as automatic tire inflation systems which is expected to have a 48 percent market penetration rate in 2018 6 While brake and suspension markets will generate nearly 60 Percent of total advanced technology related revenues by 2018, and the penetration of aerodynamics improvement technologies will increase over the 2012-2018 period, the fastest and strongest revenue growth opportunities will be accorded by safety and telematics technologies Source: Frost & Sullivan analysis. NB03-18 12
  13. 13. Executive Summary—Market Engineering Measurements Semi-trailer Advanced Technologies Market Revenue Expected to Increase to $2.98 Billion by 2018 Semi-Trailer Technologies Market: Market Measurements, North America, 2012 Market Overview Market Stage Market Revenue $2.16 B Growth 3.9 M (2012) Base Year Market Growth Rate (CAGR, 2012-2018) Decreasing Stable (2012) Forecast Period Market Growth Rate 5.50% 14.4% Market Units/Volume Estimate Market Concentration 69% (% of market share held by top 3 companies) Market Size for Last Year of Study Period $2.98 B (2018) Number of Semitrailer OEMs 30 (active market competitors in base year) Increasing Note: All figures are rounded. The base year is 2011. Source: Frost & Sullivan analysis. NB03-18 13
  14. 14. Executive Summary—Competitive Positioning of Key Industry Players Semi-Trailer Technologies Market: Competitive Landscape, North America, 2012 Semi-Trailer OEMs Tier 1 System Suppliers Aerodynamics Suppliers Telematics Providers Wabash National Meritor Aerofficient SkyBitz Great Dane Limited Partnership Meritor WABCO Freight Wing ID Systems Utility Trailer Manufacturing Hendrickson ATDynamics Qualcomm Hyundai Translead Bendix Smart Truck Star Trak Stoughton Trailers Haldex Laydon Composites PAR LMS Fontaine Trailers Eaton Ridge Corp. Transcore Source: Frost & Sullivan analysis. NB03-18 14
  15. 15. Executive Summary – Competitive Comparative Analysis Competitive Advantage of Top OEMs Achieved Through Consistent Focus on the Introduction of Advanced Semi-Trailer Technologies to the Market Advanced Technology Integration 5 Advanced Technology Market Mover 4 3 Supplier Virtual Integration 2 1 Trailer Body Material Focus 0 Wabash Telematics Focus Great Dane Utility Advanced Safety Focus Aerodynamics Enhancement Focus Advanced Chassis Technology Focus Note: • Comparison based off of Frost & Sullivan analysis of market. • Indices are representative, and are for comparative purposes only. • Indices on scale of 5;1 being lowest, 5 being highest. NB03-18 Source: Frost & Sullivan analysis. 15
  16. 16. Semi-Trailer Market Drivers and Restraints Two Major Factors in CSA 2010 and Replacement Cycle Driving the Semi-Trailer Market in the Medium-term Semi-Trailer Technologies Market: Key Market Drivers and Restraints, North America, 2012-2018 CSA 2010 driving adoption of advanced technologies Aging semitrailer population Fuel price volatility Synergies between truck and semi-trailer OEMs Favorable freight transport trends Fleets showing greater demand for soft technologies in semi-trailers Drivers Drivers Denotes long-term impact NB03-18 Longer Vertical integration restricting market equipment life cycle penetration potential for independent suppliers Restraints Restraints Too many advanced technologies chasing Volatile economic too few consumer environment dollars Denotes current impact Lack of sufficient legislative and ROI support delaying growth spurt in telematics and safety systems Source: Frost & Sullivan analysis. 16
  17. 17. Executive Summary—Total Market Unit Shipment/Revenue Snapshot Semi-Trailer Technologies Market is Expected to Reach $ 2.98 Billion in 2018 Semi-Trailer Technologies Market: Total Unit Shipment/Revenue Forecast, North America, 2012 and 2018 Air Disc Brake Axle ATIS ~ $ 2,165,089,822 $115,539,246 Drum Brake Aerodynamics TPMS Air Ride ABS Telematics Spring RSC ~ $ 2,984,804,379 $178,925,904 1,200,000 $191,548,350 $418,929,840 $122,474,290 1,000,000 $187,240,140 $972,756,750 Unit Shipment $333,583,250 $412,780,500 800,000 600,000 $1,332,518,400 400,000 200,000 $429,187,936 $454,409,595 0 Braking 2012 Suspension Axle Aerodynamics Safety Technology Braking Axle Safety Suspension Aerodynamics Telematics Note: Graph in center represents unit shipment data for 2012. Outside graphs represent revenue for 2012 and 2018. Telematics Braking Axle Safety 2018 Suspension Aerodynamics Telematics Note: All figures are rounded; the base year is 2011. Source: Frost & Sullivan analysis. NB03-18 17
  18. 18. Special Focus (Soft Technologies): Trailer Telematics Market Snapshot Clear signs of development, as vast majority of trailer population is not penetrated. Increased opportunities for telematics vendors to provide customized solutions and services to assist fleets with end-to-end asset visibility Trailer Telematics Market : Trailer Telematics Subscriber Penetration (North America), 2012 & 2018 Trailer Telematics Market : Product and Service Range (North America), 2012 Trailer Population Entry Level Trailer Telematics Subscriber Penetration 8,000,000 Hardware Cost $200 - $350 Range ($) Mid Level High End $350 - $550 $740 - $1400 $10 - $20 $20 - $35 6,930,750 Trailer Population (Million) 7,000,000 Service Cost Range ($) 6,305,000 6,000,000 $4.5 - $10 Note : The above is the market average selling price (vendor  buyer) of hardware and services 5,000,000 Trailer Telematics Market : Key Market Participants and Communication Technologies (North America), 2012 4,000,000 3,000,000 Supplier Major Telematics Solution Providers 2,000,000 1,000,000 Manufacturer SkyBitz, ID Systems, Qualcomm, Star Trak, PAR LMS, TransCore, Thermo King and others Communications Technologies Satellite > Cellular > Wi-Fi > Multimodal 20.0% 14.0% 0 2012 2018 Year Note: All figures are rounded; the base year is 2011. Source: Frost & Sullivan NB03-18 18
  19. 19. Executive Summary—Key Conclusions and Future Outlook Parameters • Market Status • • Semi-trailer OEM Competition • Future Expected to have a steady growth without any sudden spikes as recessionary environment still persists Advanced semi-trailer market is in the launch pad for robust growth in unit shipments and revenues Almost 80% of the market is consolidated by four players (Wabash, Great Dane, Utility, Hyundai Translead) 20% of market is highly fragmented (Fontaine, Stoughton, Vanguard, and others) Aggressive competition from current top market leaders looking to provide complete advanced semi-trailers to end-users. • Growing awareness and interest advanced semi-trailer technological solutions to combat government regulations and rising fuel costs Solutions • Value Proposition • Barriers to Entry in North American Market Current The potential size of the total market is vast and not fully penetrated of the 6.4 million semi-trailers. Suppliers: Nascent market with intense competition among market participants challenging for market positioning Fleets: Improved productivity, asset monitoring, operating cost and fuel economy Major portion of the market is consolidated with semitrailer OEMs and tier 1 suppliers, creating big hurdle in creating brand identity Low expectations from fragmented market group Higher levels of awareness among end users pushing technology penetration levels towards mid and high levels • Ability to offer customized solution for various fleet operations and situations • Prognostics and preventive maintenance helping fleet achieve optimal efficiency Low cost and quality semi-trailer technologies not expected to be able to penetrate the market Source: Frost & Sullivan analysis. NB03-18 19
  20. 20. Market Trends Economic Environment Weighing Heavily On Trailer Advanced Technologies Market Semi-Trailer Technologies Market: Market Trends, North America, 2012–2018 Product quality, price, financing options and after purchase service becoming the competitive factors among OEMs. The continued growth of the semi-trailer market will depend heavily on the recovery of the overall economy All market participants facing downward pressure on prices from highly price sensitive endusers. NB03-18 Reefer semi-trailers are expected to experience slow growth due to the impact of the Food Safety Modernization Act. Market Trends Semi-trailer production volume expected to experience short term growth as the current lifecycle of a large chunk of semi-trailers is nearing its end The market is currently not experiencing growth but a “recovery” from a recessionary environment and equipment replacement needs The boom in the natural gas industry could fuel a surge in tanker trailers Recessionary environment encouraging the use of mobile resources to optimize fleet operations and logistics Source: Frost & Sullivan analysis. 20
  21. 21. Technology Trends Growing Awareness of Semi-Trailer Technology Expected to Result in Increasing Adoption Stringent emission and fuel regulation impetus will drive R&D and the adoption of innovative semi-trailer technologies Semi-trailer OEMs to offer “intelligent semi-trailers” that provide fleets added performance, theft prevention, real time data from telematics, and safety enhancements Vertical integration and modualization of semi-trailer components are expected to become industry standards NB03-18 Increasing installation of safety technologies such as TPMS, ATIS, RSC, and advanced braking technologies on upcoming generation of semitrailers Technology Trends The productive lifecycle of new semi-trailers reaching 15 years if properly maintained New technologies will require maintenance technicians to adapt and learn new repair procedures Semi-trailer OEMs to increase focus on lightweight semitrailers through enhanced designs, materials and lighter components to ensure greater payload and productivity. Increasing trend towards synergistic collaboration and technology development focused virtual integration between semi-trailer OEMs and component suppliers 21
  22. 22. The Last Word—Five Big Predictions 1 The level of distributed electronics is trailers is increasing benefiting trailer safety, connectivity, and management. This will necessitate creation of electronic interfaces with key trailer systems and sub-systems. Trailer telematics poised for rapid organic growth. 2 Untethered trailer power management and creation of multiplexing of electronic communication infrastructure in trailers for better intra-trailer and trailer-tractor communication will emerge as key R&D focal points for trailer OEMs and suppliers. 3 Diesel fuel volatility and strengthening regulatory environment will lead to fleet managers and owner-operators pull advanced technologies than OEMs pushing them. Recessionary/slow growth economic environment to continue posing hurdles to rapid market adoption. 4 OEMs will use advanced technologies to differentiate products from competitors. However, too many technologies chasing too few consumer dollars will make it difficult for OEMs to choose the right set of technologies for vertical integration. 5 Advanced trailer technologies market to grow at 5.5 Percent CAGR indicating additional revenue generation equivalent to $0.82 Billion within the 2012-2018 period Source: Frost & Sullivan analysis. NB03-18 22
  23. 23. Market Engineering Methodology One of Frost & Sullivan’s core deliverables is its Market Engineering studies. They are based on our proprietary Market Engineering Methodology. This approach, developed across the 50 years of experience assessing global markets, applies engineering rigor to the often nebulous art of market forecasting and interpretation. A detailed description of the methodology can be found here. Source: Frost & Sullivan research NB03-18 23
  24. 24. The Frost & Sullivan Story NB03-18 24
  25. 25. Who is Frost & Sullivan • The Growth Consulting Company • Founded in 1961, Frost & Sullivan has over 50 years of assisting clients with their decision-making and growth issues. • Over 1,700 Growth Consultants and Industry Analysts across 32 global locations. • Over 10,000 clients worldwide - emerging companies, the global 1000 and the investment community. • Developers of the Growth Excellence Matrix – industry leading growth positioning tool for corporate executives. • Developers of T.E.A.M. Methodology, proprietary process to ensure that clients receive a 360o perspective of technology, markets and growth opportunities. • Three core services: Growth Partnership Services, Growth Consulting and Career Best Practices. NB03-18 25
  26. 26. What Makes Us Unique • Exclusively Focused on Growth • TM Global thought leader exclusively focused on addressing client growth strategies and plans – Team actively engaged in researching and developing of growth models that enable clients to achieve aggressive growth objectives. • Industry Breadth Cover the broad spectrum of industries and technologies to provide clients with the ability to look outside the box and discover new and innovative ideas. • Global Perspective 32 global offices ensure that clients receive a global coverage/perspective based on regional expertise. NB03-18 360o Perspective Proprietary T.E.A.M. Methodology integrates all 6 critical research methodologies to significantly enhance the accuracy of decision making and lower the risk of implementing growth strategies. • Growth Monitoring Continuously monitor changing technology, markets and economics and proactively address clients growth initiatives and position. • Trusted Partner Working closely with client Growth Teams – helping them generate new growth initiatives and leverage all of Frost & Sullivan assets to accelerate their growth. 26
  27. 27. T.E.A.M. Methodology • Frost & Sullivan’s proprietary T.E.A.M. methodology, ensures that clients have complete “360 Degree Perspective” from which to drive decision-making. Technical, Econometric, Application, and Market information ensures that clients have a comprehensive view of industries, markets and technology. Technical Real-time intelligence on technology, including emerging technologies, new R&D breakthroughs, technology forecasting, impact analysis, groundbreaking research, and licensing opportunities. Econometric In-depth qualitative and quantitative research focused on timely and critical global, regional, and country specific trends, including the political, demographic, and socioeconomic landscapes. Application Insightful strategies, networking opportunities, and best practices that can be applied for enhanced market growth; interactions between the client, peers, and Frost & Sullivan representatives that result in added value and effectiveness. Market Global and regional market analysis, including drivers and restraints, market trends, regulatory changes, competitive insights, growth forecasts, industry challenges, strategic recommendations, and end-user perspectives. NB03-18 27
  28. 28. Global Perspective • 1,700 staff across every major market worldwide • Over 10,000 clients worldwide from emerging to global 1000 companies NB03-18 28