Volvo 2000 Annual Report Download - page 11

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9
Market complementarity
Through joint resources and competencies, the acquisition of Mack and Renault V.I. will
enable a more competitive performance. The truck operations of Mack, Renault and
Volvo complement each other well in both products and markets, with Renault and Mack
providing a valuable supplement to Volvo’s global presence. Renault is strong in
Southern Europe and North Africa, while Volvo has its strongest presence in Northern
and Central Europe. In North America, the combined operations of Volvo Trucks and
Mack will double the Volvo Group’s truck business, providing a strong base for the future.
Product complementarity
With the acquisition, Volvo has significantly broadened the customer offering. The three
truck brands Mack, Renault and Volvo complement each other with their specific
strengths in different transport segments. In Europe, Volvo’s production of heavy trucks
constitutes more than 90 percent of the total number of Volvo trucks, while Renault’s
light- and medium-heavy trucks represent more than 40 percent of Renault’s production.
In the U.S., half of Volvo’s trucks are used for long-haulage, while Mack vehicles are
primarily used in heavy construction and regional distribution, two segments with differ-
ent characteristics and cyclicality.
Powertrain supplies the entire Volvo Group
Volvo is now one of the world’s four largest manufacturers in terms of
heavy diesel engines (>8 liters volume). To fully exploit the economies of
scale created through the virtually doubled volumes of engines, a new
business unit has been formed – Volvo Powertrain. This unit will supply the entire Volvo
Group with engines, transmissions and other driveline components and the coordinated
development and production will be beneficial to all business areas. In the long term, coor-
dination gains will increase as we change over to a common basic engine program. Volvo
Powertrain operates in Sweden, France, North America and South America with a total of
approximately 8,500 employees.
Mack Trucks Inc.
Mack is one of the largest manufactur-
ers of heavy trucks in North America,
with a market share of slightly more
than 13% (2000) in the U.S. ”Class 8”
segment. Mack was founded in 1900,
and focused on commercial vehicles
from the start. Today, Mack is one of
the strongest heavy-truck brands in
North America. The product program
includes heavy and medium-heavy
trucks, military vehicles and special-
purpose commercial vehicles.
The Vision model, launched in
1999, is designed for heavy and
demanding long-range transportation
assignments. The versatile CH series
is intended for regional transport and
long-distance haulage. A clear majority
of Mack’s heavy trucks employ drive-
lines manufactured in-house –
a unique feature in the North American
market. The Mack Mid-Liner in the
medium-heavy class is designed for
distribution services and other short-
distance transports.
Europe product
complementarity
Volvo Renault
■ Heavy trucks
■ Medium and light trucks
U.S. product
complementarity
■ Heavy distribution and construction
■ Long haulage
Volvo Mack
Powertrain will supply the entire
Volvo Group with common solutions