The top 10 truck manufacturing companies in the world control the bulk of the world’s market share. For example CNH Industrial NV (NYSE:CNHI) controls 13.1% of the European truck market, 13.9% of the light truck market, and 34% of the medium truck market. PACCAR Inc (NASDAQ:PCAR) has a medium-duty market share of 16.2% and a 28.5% share of the class 8 truck market in the U.S and Canada. where one of its main competitors, Navistar International Corp (NYSE:NAV), also has market share of around 25%.
The reason why a small number of companies have such large market shares is the high barriers to entry. Similar to the automotive, agricultural and construction equipment industries, the truck industry is capital intensive. At the same time, the market size is pretty limited. In 2016, there were 2.68 million medium and heavy duty trucks sold worldwide, a slight increase of 2.4% over the year, according to Frost & Sullivan. In this way, companies buy other brands in order to expand their market share. As you will see from the list on the following pages, most of the top 10 truck manufacturing companies in the world own several brands.
Aside from the small market size, there are other challenges that Original Equipment Manufacturers (OEMs) in the truck industry are facing. Governments are imposing more and more strict regulations on emissions and the sizes of trucks in order to address global warming. Safety is another concern, especially in large urban areas, where traffic density has increased as cars have become more affordable.
To address the issue of emissions, truck manufacturers have to invest more in R&D in order to build engines and drive trains that are more efficient so as to use less fuel, or even use fuel with lower emissions of carbon, such as LNG. To improve security, truck companies have to include sensors that allow the car to detect potential hazards and either warn the driver or perform the necessary actions to avoid a potential accident.
Luckily for truck manufacturing companies there are plenty of technologies available that can address most issues and improve the driving experience. The problem is that with some features being mandatory, truck manufacturers face higher costs of production, which leads to either higher prices and lower demand, or lower margins and weak financial results. However, at the same time, new technology offers truck manufacturers the possibility to diversify their product line-ups and establish their positions in new markets, like hybrid, or even fully-electric trucks.
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Overall, it is expected that over the next decade or so, the truck manufacturing industry will develop in two separate markets. First, there will be the more developed countries, like the U.S, European Union, Japan, etc., which are highly industrialized and whose governments have imposed strict regulations on emissions and safety. This will also be the market where companies will introduce new technologies and experiment with new features like autonomous driving. Then, there are countries that aren’t so developed, where customers put a big emphasis on price and don’t really care about additional features. As these are still emerging markets, it is expected that truck manufacturers will see more sales growth in these regions.
Having said that, let’s take a look at the top 10 truck manufacturing companies in the world. The list is based on the total number of trucks these companies sold in 2016 and begins on the next page.
Units sold: 81,350
Scania is another subsidiary of Volkswagen AG. The Sweden-based company has production facilities in Sweden, France, The Netherlands, India, Argentina, Brazil, Poland, and Russia, plus assembly lines in ten countries in Europe and Africa. Scania recently released a new generation of trucks, which are fitted with new Euro 6 V8 engines capable of reducing fuel consumption by 7% to 10%.
Units sold: 83,200
MAN is a subsidiary of Volkswagen AG which manufactures trucks and buses, in addition to engines and turbomachinery. Recently, MAN’s MAN Truck & Bus division entered into a partnership with logistics group DB Schenker to develop networked truck platooning, which involves closing the distance between cars in order to increase the capacity of roads.
8. PACCAR Inc (NASDAQ:PCAR)
Units sold: 104,900
PACCAR Inc (NASDAQ:PCAR) is a Fortune 500 company that makes trucks under the Peterbilt, Kenworth and DAF names. In the U.S and Canada, PACCAR Inc (NASDAQ:PCAR) has 28.5% market share in the Class 8 trucks segment, while in Europe its market share in the medium-duty trucks market amounts to 16.2%.
Units sold: 134,300
Next up on the list of the top 10 truck manufacturing companies in the world is Iveco, a brand of trucks and buses owned by Netherlands-based CNH Industrial NV (NYSE:CNHI). CNH Industrial NV (NYSE:CNHI) delivered 140,200 commercial vehicles in 2016, out of which 4,000 were specialty defense and firefighting vehicles and 9,300 were buses. CNH Industrial NV (NYSE:CNHI) sold most Iveco trucks in Europe, where it has market share of 11.3%.
Units sold: 171,800
Hino is a Japanese manufacturer of trucks and buses. The company registered an increase in sales of heavy- and medium-duty trucks in Japan, as overall demand increased, with Hino having 37.7% market share in the country. In the light-duty segment, Hino’s market share amounts to 25%. At the same time, higher sales in Japan were offset by lower overseas sales, particularly in the Near and Middle East. Nevertheless, Hino’s unit sales inched up by 2.1% during 2016.
5. Volvo Group
Units sold: 190,424
We are continuing our list of top 10 truck manufacturing companies in the world with Volvo Group that makes trucks under the Volvo, UD, Renault Trucks, Mack, Eicher, and Dongfeng Trucks names. Its truck sales account for 66% of total group sales. Volvo also remarked that the European truck market was strong in 2016, with 300,000 new vehicle registrations, while North America and Brazil registrations declined.
4. Navistar International Corp (NYSE:NAV)
Units sold: 313,600
Navistar International Corp (NYSE:NAV) ranks 4th in our list of top 10 truck manufacturing companies in the world. It is a Fortune 500 company that manufactures commercial and military trucks under the International brand and proprietary diesel engines and buses under the IC brand. The company’s core markets are in the U.S and Canada, where it sells Class 6 through 8 vehicles. Navistar International Corp (NYSE:NAV) claims that one-in-four Class 6 through 8 trucks on the road in the U.S and Canada is an International.
Units sold: 369,100
Dongfeng is a Chinese state-owned manufacturer of vehicles and is one of the largest in the country in terms of output, commanding market share of around 11%. The company sold 369,100 commercial vehicles in 2016, which represented an increase of around 7% over the year.
2. Tata Motors Limited (ADR) (NYSE:TTM)
Units sold: 388,396
Tata Motors Limited (ADR) (NYSE:TTM) is one of the largest automotive companies in the world, whose subsidiaries include British premium car manufacturer Jaguar Land Rover and South Korean commercial vehicle manufacturer Tata Daewoo. The company’s commercial vehicles are mostly oriented for the domestic market, with the bulk of sales registered there.
1. Daimler Group
Units sold: 415,108
Topping the list of the top 10 truck manufacturing companies in the world is Daimler, a large manufacturer of vehicles that also makes trucks under the brands Mercedes-Benz, Western Star, Freightliner, Mitsubishi Fuso, and BharatBenz. During 2016, Daimler Trucks registered a 17% drop in unit sales, due to sales declines in Turkey, Latin America, and the NAFTA countries.
These are the top 10 truck manufacturing companies in the world. The companies on this list either represent big corporations with large brand portfolios, or are subsidiaries of large companies. This not only allows them to keep their leading market positions, but also to invest heavily in developing new technologies in order to satisfy customers’ needs and stay ahead of the competition.