AUSTIN, Texas — Roger Nielsen, CEO of Daimler Truck North America, discussed electrification, autonomy, the state of the economy and the supply chain during a round table at the American Trucking Associations Annual Management Conference and Exhibition in Austin, Texas.
“A lot is going on in the industry, and we continue to work on all propulsion technologies,” said Nielsen, who last week took part in the first meeting of the Electric Vehicle Council. The manufacturer brought in 30 of their top customers who had a chance to drive electric vehicles in a process the company call co-creation, “a way to bring products and features quicker to the market.”
“We spent a lot of time talking with customers about charging infrastructures and incentives,” Nielsen said.
Next week, Daimler will welcome some 60 government officials in Portland to discuss technology and innovation and see how they can help.
The company recently announced that Penske Truck Leasing and NFI have agreed to partner in operating the Freightliner Electric Innovation Fleet of eCascadia heavy-duty trucks and eM2 106 medium-duty trucks for drayage activities from the ports of Los Angeles and Long Beach, to warehouses in California’s Inland Empire.
“We are excited to get them on the road and to learn what it takes to keep these vehicles running strong and well,” Nielsen said.
On the production side, Daimler forecasts more than 440,000 Class 6-8 trucks this year for US, Mexico and Canada. “There was 330,000 deliveries through September, which is usually a very good year, but we still have two months to go,” Nielsen said. “We’re going to have a strong year end.”
The company’s Class 8 market share in the U.S. is now 32%, slightly less (-1.6%) compared to last year. In Canada, Daimler holds 39% of the Class 6-8 segment, a slight decrease (-0.4%) compared to 2017.
Still, the booming economy also means dealing with shortage of supplies. “Supply chain management is a daily challenge,” he said
Nielsen explained that the industry is running at peak volumes and supply chain challenges are holding the company back from delivering more units. “Little hiccups required [us] to go to extreme measures to get the parts we needed. But we saw some stabilization over the last two or three months and we are running at stable rates,” he said.
Strong demand often means that dealers will secure more slots than they might really need, too. In the case of cancellations or a downturn of the economy, that leaves the threat of excess inventory.
“You will not see that at Daimler. We are working with dealers and customers to make sure they have the ability to access build slots. If an order looks speculative, we will cancel it. We don’t want people to handle inventory they can’t put into productive use. I don’t think it’s good for the industry to take speculative orders. I hope the industry did a good job.”
Regarding tariffs and the new USMCA trade deal, Nielsen said Daimler is well positioned to comply. If it is approved, the agreement will in seven years require truck makers to incorporate 70% of regional value in their products. Daimler engines, axles and transmissions are made in Michigan, so complying should not be a problem. The situation is a little more difficult with inbound tariffs though, as aluminium and steel prices went up and stayed high. But “all the OEMs are experimenting the same costs,” he said.
In its efforts to change the culture of the company to be more customer-focused – a key goal of Daimler for 2018 – the one-stop warranty program was relaunched. This program eases the claims process for components from third-party supplier.
Another big goal for Daimler is to upgrade and expand its parts business. Part of that strategy is opening more Alliance Truck Parts lines, opening stores in dealerships and having more parts distribution centers.
“We continue to make big investments in driver safety systems,” said the CEO. This year, Detroit Assurance 4.0 suite of actives safety systems are specified on 75% of Detroit-powered vehicles. “There are more things to come with enhancement to the suite.”