It’s been a challenging fourth quarter for Volvo Group; following a successful outing at the 2018 IAA Commercial Vehicles Show, the truck maker found itself announcing a potential truck engine emission control system problem. The fault – involving NOx emissions linked to the SCR system – primarily impacted trucks in North America and Europe. A costly issue, indeed, but addressing it publicly and transparently helped avert a public relations disaster of the sort that other automakers have brought upon themselves through poor communications and denial.
Volvo Group – whose portfolio includes not only Volvo but also Renault, Mack and UD Trucks – delivered 202,400 trucks and 9,400 buses in 2017, for a combined total of 211,800 units. The group claims to be the world’s largest heavy-duty truck manufacturer. Indeed, the inclusion of non-consolidated sales by its two major joint ventures, VECV and Dongfeng Commercial Vehicles (DFCV), raises its deliveries for 2017 to 420,400 units.
However, the claim needs careful consideration: if Volvo’s sales include DFCV and Eicher, then Daimler’s should include Foton and KamAZ, making the race for the top spot a much tighter one. In truth, it’s merely headline grabbing stuff – unless synergies and economies of scale can be generated across a group made up of acquired companies and joint ventures, size merely reflects the scope and complexity of management involved.
Vera highlights a serious line of thinking at the company. Vera is a fully electric vehicle, and Volvo Trucks has touted its plans for low and zero emissions trucking for some time now
The company’s recent history has been marked by growth and acquisition, but the focus now is on improving performance, developing a corporate and brand strategy, and ensuring a suitable place in its portfolio for electric drivetrains and autonomous drive technology.
A new Automotive World strategy report examines the prospects for Volvo Group’s operations in the five years to 2022. “Like its peers, Volvo faces major challenges in the coming years as it ramps up investment in new areas such as CASE and CO2 reduction, while ensuring its existing models and powertrains remain competitive and profitable,” said report author Jonathan Storey.
However, he added, “The good news is that the company has seldom been in better shape to face such challenges, as it reaps the benefits of earlier acquisitions which have enabled it to set an historically high target for profitability and to aim for zero industrial debt.
“Our report’s forecast is supportive of these targets, as it anticipates the company’s output including joint ventures, rising at a CAGR of 2.7% over the five years to 2022,” said Storey.
The company has made significant ground when it comes to the development of future truck solutions, notably electrification and autonomous drive technology.
Vera, for example, is the manufacturer’s bold vision for the future of trucking: without the need for a driver, there is no need for a driver’s seat, or cab. The fully-electric, fully-autonomous cab-less tractor concept is designed primarily for local and fixed route applications, such as in ports and logistics yards. The vehicle drives itself using a combination of sensors, although it can be configured for tele-operated driving. There are no current plans to commercialise Vera, but Volvo says it is talking to a number of potential customers. In terms of bringing the vehicle to market, much of what underpins Vera has been drawn from existing Volvo Group technology.
Volvo Group – whose portfolio includes not only Volvo but also Renault, Mack and UD Trucks – delivered 202,400 trucks and 9,400 buses in 2017, for a combined total of 211,800 units
A concept it may be, but Vera highlights a serious line of thinking at the company. Vera is a fully electric vehicle, and Volvo Trucks has been developing solutions for low and zero emissions trucking for a number of years. The truck maker used the 2018 IAA to showcase its Volvo FE Electric and FL Electric trucks, both of which are being prepared for shipment to customers in 2019. And the FE Electric powertrain will be used in the electric VNR truck which Volvo will launch in North America in 2020. Initial customer deliveries will make little impact on the company’s overall delivery numbers, but the rate at which the truck industry is accepting the need for electrification, led by legislation and regulations, total cost of ownership and corporate social responsibility, put the company in a strong position on which to build EV sales.
Volvo Group’s truck and bus consolidated output is forecast to grow 12-13% in 2018, to around 224,000 units, and further in 2019 according to Automotive World’s report. Despite a subsequent dip, the group will reach a new output peak of around 249,000 units by the end of the forecast period.
To learn more about how Volvo Group aims to grow over the next five years, whilst also incorporating CASE technologies into its wide and varied portfolio, download Automotive World’s latest Strategy update: Volvo Group – 2018 edition.
