As reported by AutomotiveWorld.com (2 July), Finnish truck maker Sisu has concluded an agreement with Daimler for the supply of Mercedes-Benz heavy truck components, including engines. The contractual arrangement replaces the joint venture which has effectively been in place for 13 years, originally signed by Sisu and Renault, but which transmogrified into a Sisu-Volvo deal, when the Swedish company gained control of Renault Trucks in 2000.
Through several changes of ownership by different Finnish industrial groups, and currently the subject of a management buy-out led by CEO Olof Elenius, Sisu always relied on proprietary, ie outsourced, engines. Since the demise of the venerable UK heavy truck marques Foden, ERF and Seddon Atkinson, Sisu has been alone among European manufacturers in eschewing the philosophy of vertical integration. Like those originally independent British companies, Sisu put its faith in diesels of North American origin, from Cummins and more recently from Caterpillar.
But Sisu’s component sourcing strategy underwent a profound change in 1997 when an agreement was signed with Renault Vehicules Industriels (RVI). Under its provisions, Sisu marketed Renault chassis in Finland while the French truck builder supplied its partner with its newly-introduced Premium cab. Sisu also began offering Renault engines including the French-designed 11.1-litre MIDR unit and the 12-litre E7 diesel, the latter shipped in from RVI’s North American Mack Trucks subsidiary, principally to power Renault’s tall-cabbed Magnum range.
Sourcing engines from such a direct rival as Volvo was clearly less than satisfactory for Sisu – and for its dealers when servicing was due
However, some Sisu customers, typically those involved in timber and heavy construction haulage, retained a preference for Cummins and more particularly Cat power units, which the company remained willing to offer. But three years into the Franco-Finnish deal, Volvo acquired Renault Trucks (and Mack), leading in due course to the MIDR and E7 engines being unceremoniously scrapped and replaced by more modern and fuel-efficient Volvo equivalents.
In 2006, with the implementation of Euro 4 emission laws in Finland and the rest of the EU, there were no longer any compliant Cummins or Cat engines available to Sisu for on-highway applications, though Cat power remained for Sisu’s established military trucks. It left Volvo’s 12.8-litre D13 diesel as effectively the standard power unit, with no options. From a technological viewpoint it was satisfactory. The engine was well proven, with up-to 500hp performance.
Sisu expects to build a modest 150 to 200 Mercedes-Benz Actros based trucks in 2011, building up to an annual output of 400 units
But commercially, it posed a dilemma for Sisu and its dealers. Volvo has long been one of its two main Scandinavian competitors, the other being Scania, albeit with the Finnish company catering mainly for specialist heavy-duty operations, in the forestry, quarrying and construction industries. Sourcing engines from such a direct rival as Volvo was clearly less than satisfactory for Sisu – and for its dealers when servicing was due.
It was perhaps therefore no great surprise when the new tie-up between Sisu and Daimler was announced. Mercedes-Benz is nothing like as serious a competitor as Volvo for Sisu, whose concerns focus almost entirely on its domestic market. But of course, Daimler and Volvo are the world’s two biggest truck builders and, as such, are deadly rivals. Under the new joint venture with Daimler, Sisu expects to build a modest 150 to 200 Mercedes-Benz Actros based trucks in 2011, building up to an annual output of 400 units. The vehicles will use engines, cabs and transmissions from Daimler, but with in-house axles and chassis frames.
However, an intriguing question arises concerning the longer term arrangement between Sisu and Daimler. Actros chassis and their OM521/522 V6/V8 engines, which are central to the deal, are due to be replaced, probably towards the end of next year, by an all-new range of Mercedes heavy trucks. The vee engines will be replaced by the new generation of 12.8, 14.8 and 15.6-litre Daimler in-line-six engines code-named HDEP (heavy duty engine platform), which are already being produced in the US under the Detroit Diesel banner. It seems probable that after that major introduction by Mercedes, today’s Actros cabs and engines will remain in limited production for export markets outside Europe, as well as for Sisu.
The opinions expressed here are those of the author and do not necessarily reflect the positions of Automotive World Ltd.
