Volvo 2012 Annual Report Download - page 46

A GLOBAL GROUP 2012 GROUP PERFORMANCE
Growing truck market
In 2012, the total market for heavy-duty trucks
in North America increased by 15% to 249,600
trucks compared to 216,100 in the previous
year. Demand was strong mainly during the first
half of the year, driven primarily by the need to
replace the industry’s aging highway tractor
population. During the second half, demand
weakened as many trucking companies post-
poned their investment decisions as a conse-
quence of continued uncertainty about the eco-
nomic development, weak employment growth
and the outcome of the federal budget negotia-
tions. For 2013, the market is expected to be at
about the 2012 level of 250,000 heavy-duty
trucks.
Growth continued on the market for construc-
tion equipment during 2012. In total, the market,
measured in number of machines, rose by 23%
compared to 2011, which also was a year of growth
following a number of weak years. For 2013,
growth in the North American market is expected
to be in the range of minus 5% to plus 5%.
The North American market for city buses
continued to be weak due to the budget restric-
tions in effect in many cities. Recovery in the
coach market was slow.
Success thanks to good products and
strong network
During 2012, the Volvo Group maintained its
market shares in North America. The combined
market share in the heavy-duty segment was
18.3% (18.2), on the back of a competitive cus-
tomer offering of trucks equipped with engines
and gearboxes that provide considerable fuel
savings, improved drivability, less wear and
improved safety. The new drivelines have meant
that an increasing number of customers opt for
Volvo Group engines. During 2012, 79% (79) of
Volvo trucks built in North America were
equipped with Volvo engines. The vast majority
of Mack trucks are equipped with the Group's
Mack engines.
Volvo Trucks' dealers in the US have in recent
years made substantial investments in their ser-
vice networks. In the Southeastern parts of the
country, service capacity has increased by some
20% since January 2010. In Texas, service
capacity has increased by 32%. In the West,
investments have led to a capacity increase of
almost 15%.
On the weak North American market for
coaches, Prevost defended its position as the
second largest brand in the US and Canada with
a market share of 30% (34). Nova Bus is the
third largest supplier of city buses in North
America with a market share of 14% (15) and
with considerable potential for continued growth.
Success for I-Shift and mDRIVE
As a result of the strong demand for the Group's
automated mechanical transmissions, produc-
tion of the Volvo I-Shift and Mack mDRIVE gear-
boxes started at the U.S. engine plant in 2012.
Volvo Trucks introduced its I-Shift transmission
on the North American market in 2007. During
2012, 59% (45) of trucks with Volvo engines in
North America were equipped with I-Shift. Since
I-Shift is only available together with Volvo
engines, this also helps promote sales of the
company's own engines. I-Shift incorporates a
host of fuel-saving and productivity-enhancing
features into a reliable and lightweight design.
mDRIVE was introduced in Mack products in
2010 and already during 2012 it was installed in
27% of all Mack highway trucks.
Volvo CE expands in Shippensburg
Over the next couple of years, Volvo Construction
Equipment (Volvo CE) invests USD 100 M in its
Shippensburg, Pennsylvania, USA manufacturing
facility. In the long term, the plant will be able to
produce 70% of the machines sold in the North
American market. Groundbreaking for the new
facility was in May of 2012.
North America is the Group's second largest market and
its overall development continued to be positive in 2012.
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DEVELOPMENT BY CONTINENT
Continued growth in North America
UD Trucks ends production for U.S. Market
Due to a combination of factors, including the
continued shrinking of the cab-over-engine
market segment and the accelerating cost of
regulatory compliance, a strategic decision was
made to end production of UD trucks for the
U.S. market. UD Trucks delivered 472 trucks in
North America in 2012.
Volvo Group strengthens its range of
trucks powered by natural gas
Under the Mack brand, the range of trucks pow-
ered by natural gas will be expanded by a further
two models during 2013, Mack Pinnacle and
Mack Granite. The Mack TerraPro model is
already available to customers in the waste
mangement segment. All models will be offered
with engines powered by either liquid natural
gas (LNG) or compressed natural gas (CNG).
The Volvo Group also plans to launch a proprie-
tarily developed 13-liter engine for liquid natural
gas (LNG) under the Volvo brand in the North
American market in 2014.
Full lineup of trucks earns 2014 green-
house gas certification
The US Environmental Protection Agency and
National Highway Traffic Safety Administration
have certified all Volvo Group truck models in
the US, both Mack and Volvo branded, in accord-
ance with 2014 fuel efficiency and greenhouse
gas regulations.
− The Volvo Group is committed to leading
the way in fuel efficiency, and to reducing the
emissions from our operations and products.
This shows that the Group is at the forefront of
technology development and that the develop-
ment benefits the entire Group and our brands,
said Dennis Slagle, Executive Vice President
Group Trucks Sales & Marketing Americas.
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