north american truck (class 8) engines are shrinking
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A brief summary of key takeaways from Frost & Sullivan's research aimed at engine downsizing strategies of major North American Class 8 truck manufacturers and its impact on the commercial vehicle industryTRANSCRIPT
Strategic Analysis of Engine Downsizing Trends of
North American Heavy-duty Truck Manufacturers A 2% to 3% Reduction in Class 8 Truck Engine Displacement Expected by 2018
NAAF–18
December 2012
2 NAAF–18
Research Team
Bharani C. L. Industry Analyst
Automotive & Transportation
(91.44) 6681.4121
Ananth Srinivasan Senior Research Analyst
Automotive & Transportation
(91.44) 6681.4125
Lead Analyst Contributing Analyst
Research Director
Sandeep Kar Research Director–Commercial Vehicles
Automotive & Transportation
(1) 416.490.7796
Strategic Review Committee Leader
Sarwant Singh Partner
Automotive & Transportation
(44) 207.915.7843
3 NAAF–18
Table of Contents
Section Slide Number
Executive Summary 4
Research Objective, Scope, Methodology, and Background 17
Definitions and Segmentation 24
Mega Trends and Industry Convergence Implications 30
Market Dynamics and Impact on Powertrain Technologies—North America 35
HD Engine Downsizing in North America—Overview 49
Engine Downsizing Strategies—North America OEMs 64
Conclusions and Strategic Recommendations 89
Appendix 94
SuperTruck Program—Key Insights 95
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Executive Summary
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Powertrain Downsizing—Key Findings
• Weighted average engine displacement is expected to shift from 13.7 to 14.1 liters (L) in 2011 to
13.4 to 13.7 L by 2018, amounting to 2 to 3 percent downsizing. A corresponding shift in power
density is expected to be at 6 to 8 percent, increasing from the current level of 36.6 bhp/L to 38.9
bhp/L. Technology advancements are enabling 11 L engines to deliver 380 to 420 horsepower (HP).
1
2
3
4
• Key market drivers include changes in freight movement patterns, increasing urbanization, and
penetration of natural gas and hybrid commercial vehicles.
• A strong used truck market and possible introduction of mega-trucks in the long term are expected
to be the two major market restraints.
• Engine downsizing is expected to be higher in the vocational and regional/local haul segments
when compared to the line-haul segment.
• The share of larger engines in the line-haul segment is expected to decrease as a result of the
“trucks cubing out before weighing out” trend.
• All heavy-duty original equipment manufacturers (OEMs) interviewed have shown varying degrees
of preference for downsizing, OEMs’ activities are expected to show results from 2014 onwards
and will be driven by continued fuel price volatility and rising adoption of CNG/LNG and hybrid
heavy-duty trucks.
• This rising preference for downsizing is indicative of an “OEM push” rather than a “market pull” in
the North American heavy-duty engine market.
Source: Frost & Sullivan analysis.
Heavy-duty Engine Market: Key Takeaways in North America, 2012
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Powertrain Downsizing—Big 5 Predictions
1
Engine downsizing is gaining preference in the North American heavy-duty (HD) truck industry. In
conjunction with other advanced technologies, this is expected to drive reduction of fuel consumption and
emission by at least 20 percent by 2018. This is also expected to provide flexibility in engine right-sizing
for major HD OEMs, which are increasingly adopting platform-based truck production.
2
Weighted average reduction in engine displacement is estimated through OEM/vocation-based analysis to
be between two to three percent for the industry. In 2011, the weighted average displacement was 13.7 to
14.1 L, which by 2018 is expected to shift to 13.4 to 13.7 L. Power output for the same period is expected
to increase from the current 400 to 520 HP to 425 to 540 HP range.
3
Dominance of 15 L engines is expected to continue in the Class 8 long haul segment, although its share
within the long haul segment will decline. Driven by factors such as the downsizing of activities of OEMs,
growth in the regional/urban haul segment, Cummins Inc.’s larger role in the 12 to 14 L range, vertical
integration within the industry, and regulatory pressures, the installation of 12 to 14 L engines is expected
to increase and come on par with 14 to 15 L engines by 2018.
4
Daimler trucks and Volvo trucks are two participants expected to be the strongest proponents of
downsizing in the forecasted period. Navistar Inc. will pursue increased downsizing activities post 2015,
owing to its recently adopted SCR-based emission reduction strategy. Cummins Inc. is expected to
increase downsizing activities gradually from 2013 until 2018.
5
Key factors such as the rising proliferation of CNG/LNG trucks; the rising utilization of technologies such
as downspeeding, advanced turbocharging, waste heat recovery, and in-cylinder improvements; and the
rising proliferation of semi-automatic transmissions are expected to bridge the demand-supply gap for
downsized engines. Source: Frost & Sullivan analysis.
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Technology
Description
Level of Industry
Interest
Dependency
Rating
Expected End-
User Benefit
Key OEMs
Advanced in-cylinder
improvements Cummins, Daimler, Navistar
Downsizing Volvo, Daimler
Downspeeding Daimler, Navistar, Paccar,
Volvo
Hybridization Daimler, Navistar, Paccar,
Volvo
WHR Daimler, Volvo, Navistar,
Cummins
Turbochargers and
boosting technologies
Daimler, Navistar, Paccar,
Volvo, Cummins
Advanced after-
treatment
Daimler, Navistar, Paccar,
Volvo
Engine prognostics Daimler, Volvo
LEGEND High Medium-High Medium Low
Note:1. All ratings are qualitative.
2. Ratings are a combination of F&S analysis and
market research.
Advanced Powertrain Technologies—Comparative Outlook In-cylinder Improvements and WHR Emerge as Best-Fit Technologies at Present; Downsizing, Downspeeding,
and Turbo Technologies Expected to Gain Preference by 2018
Source: Frost & Sullivan analysis.
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Convergence of OEM capabilities and end-
user preferences
Advanced Powertrain Technologies—Benefit versus Barriers Future Truck Powertrain Will Leverage Multiple Solutions for Fuel Efficiency Enhancement; Downsizing
Emerging as a Key Ingredient of an Integrated Solution
Benefit to Industry Medium High
1
Hig
h
Me
diu
m
3 2
4
5
6
Te
ch
no
log
y B
arr
iers
7 8
• Independent engine technologies capable of delivering
significant improvements in engine/vehicle efficiency
• Key focus area for all HD OEMs
• Technological advancements in these areas are easily
deployed across product ranges, thereby improving their
RoI ratio. Legend: 1—advanced in-cylinder improvements; 2—
downsizing; 3—downspeeding; 4—hybridization; 5—WHR;
6—turbochargers and boosting technologies; 7—advanced
after-treatment; 8—engine prognostics
• Highly inter-dependent technologies with high-end
user/industry benefits
• Driven by regulation, after-treatment and downsizing
technologies require high capital investment from the
OEMs to accomplish desired levels of benefit.
• Expected to continue being key ingredients of the long-
term strategy of all HD OEMs
• Downspeeding is emerging as a major focal point for
OEMs to enhance fuel efficiency, sometimes in
conjunction with and also independent of downsizing.
Least
preferred zone
Most preferred
zone
Note: Representation is only for indicative purposes.
Mapping is based on primary and secondary research. Source: Frost & Sullivan analysis.
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7.9
7.8
8.4
7.6
8.2
7.9
8.1
7.5
In-cylinder improvements
Downsizing
Downspeeding
Waste heat recovery
Turbochargers and related
boosting technologies
Advanced after-
treatment
Engine prognostics
Hybridization
Note:
1. Ranking is on a scale of 1 to 10,
with 10 being most preferred,
and 1 being least preferred.
2. Weighted average ranking used
as representative of industry.
Individual OEM level rankings
are detailed in respective OEM
profiles.
Advanced Powertrain Technologies—Weighted Average Preference Ranking OEMs’ Preference Ratings for Various Technologies Reveal Downspeeding, Waste Heat Recovery, and
Advanced After-treatment as Top Three Most Focused Technologies
• Downspeeding emerges
as top preference
across all OEMs.
• WHR is critical due to
significant benefits the
technology offers.
• All OEMs are expected
to focus on after-
treatment technologies,
owing to regulatory
mandates.
Source: Frost & Sullivan analysis.
Heavy-duty Truck Engine Market: Weighted Average Preference
Ranking of Advanced Powertrain Technologies by Key OEMs,
North America, 2011
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Heavy-duty Powertrain Configuration—Future Blueprint Three Percent Reduction in Engine Size Driven by 5 Percent Improvement in Power Density Will Usher
Right Sizing of Engines in North American Class 8 Trucks
* Note: All data is proprietary F&S estimates. Weighted average numbers are used, and serve only as representatives of downsizing and
related activities in the industry.
Parameter Baseline
specification*(2011)
Expected future
specification* (2018)
Key Insights*
Engine displacement 13.7 L–14.1 L 13.4 L–13.7 L 2 to 3 percent reduction
High-end Engine
Power 400–520 bhp 425–540 bhp 4 to 6 percent increase
Engine torque 1250–1650 lb. ft. 1300–1750 lb. ft. 4 to 6 percent increase
Configuration In-line 6 cylinder In-line 6 cylinder
Cylinder de-activation being
tested for mid- to long-term
implementation
Turbo technology Predominantly VGT Predominantly VGT Electric turbo-compounding
expected by 2018
Transmission • Predominantly
manual
• Large proportion of
third party
transmission
offering
• Rising penetration of
AMT
• OEM proprietary
transmission as
standard
Increasing market trends
toward optimized
proprietary engine-
transmission-axle offering
Brake thermal
efficiency 42 percent 50 percent or above
SuperTruck program
expected to be a major step
toward BTE improvement
Source: Frost & Sullivan analysis.
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Median range
Analysis of Key Design Parameter Ranges for HD Engine Market, 2011–2018 Powertrain Downsizing Pushing Weighted Average Engine Displacement to Under 14 L in Class 8 Trucks by
2018
9 10 11 12 13 14 15 16
9 10 11 12 13 14 15 16
Displacement (in L) Torque (in lb. ft.)
2011
2018
2011
2018
2011
2018
Power (in bhp)
300 350 400 450 500 550 600 650
300 350 400 450 500 550 600 650
1100 1250 1400 1550 1700 1850 2000 2150
1100 1250 1400 1550 1700 1850 2000 2150
13.7 L–14.1 L
13.4 L–13.7 L
2%–3%
reduction
400–520 bhp
425–540 bhp
4%–6%
increase
1250–1650 lb. ft.
1300–1750 lb. ft.
4%–6%
increase
Source: Frost & Sullivan analysis.
Heavy-duty Truck Engine Market: Diesel Engine Market Overview, North America, 2011
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Voice of Customer Research (Next Five Years) In 2012, 1 in 5 Fleet Managers of Top-100 Class 6–8 Truck Fleets in the United States Anticipate Spec’ing
Downsized Engines; In spite of Being a Small Fraction, This Shows a Noticeable Market Trend
3%
20%
91%
0% 20% 40% 60% 80% 100%
Smaller trucks withsmaller displacement
engines
Trucks in the samevehicle weight class
with smallerdisplacement engines
Trucks in the samevehicle weight classwith similarly sized
(displacement) engines
Percentage of
each choosing
only this
response
86% 45% 0%
Vocational 93% 29% 14%
On Highway
91% 19% 1%
Base: All 2012 respondents (n=100).
Q34. Thinking about your fleet's vehicle purchases in the next five years, please select all of those which you
anticipate buying. (Multiple response) Source: Frost & Sullivan analysis.
Note: Data sourced from Frost & Sullivan Customer Research
2012.
Heavy-duty Truck Engine Market: Fleet Vehicle Purchase Intentions, United States, 2012
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Source: Daimler, Frost & Sullivan analysis
Case Study—Cascadia Evolution Significant Improvements Without the Need for Downsizing, Indicating Further Improvement Potential If and
When Downsizing is Introduced
Engine
Transmission
Detroit DD15
( 100 lbs. lighter
than previous
DD15 engine)
• GHG 2014 norms compliant
• Asymmetric turbocharger
• Next-generation amplified
common rail system
• Single filter system (which is
expected to double the change
interval to 100,000 miles)
DT12 AMT
Detroit drive
axles
Axles
• Proprietary transmission based
on second generation AMT in
Daimler E.U. trucks
• Two pedal AMT, featuring
pneumatic clutch and shift
actuator
Aerodynamics
• Improved frontal area aerodynamics, including new air
dam, hood-to-bumper fill
• Integrated antenna, elliptical shaped mirrors
• Chassis side fairings, and 20-inch side extenders
System Description Key Improvements
Cascadia
Evolution shows
the success of
Daimler’s
vertical
integration
strategy
Using Evolution
as a base and
downsizing as
a strategy,
Daimler can
further enhance
power density
and fuel-
efficiency of its
engines
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Research Scope, Objectives, Background, and
Methodology
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Research Scope
Heavy-duty Commercial Vehicles Vehicle Type
2012 to 2018 Forecast Period
2008 to 2018 Study Period
2011 Base Year
North AmericaUnited States, Canada Geographical Scope
Source: Frost & Sullivan analysis.
Year 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Class 8 truck
production
(in ‘000)
238.5 248.1 245 305.4 325.4 287.2 299 318 327.9 340.1
Heavy-duty Truck Engine Market: Partial List of Forecast
Database North America, 2011–2020
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Research Aims and Objectives
Objective
To understand the macro-trends necessitating fuel efficiency improvements and emission reductions.
To outline market drivers and restraints, industry challenges in downsizing, and their key benefits
Compare and analyze the powertrain downsizing strategies of major HD OEMs in North America
Predict technology and market trends that will shape downsizing and will be shaped by downsizing with an aim to offer strategic insights to facilitate decision making
Source: Frost & Sullivan analysis..
Aims
To understand and analyze the extent of engine downsizing that will shape engine design in North American heavy-duty trucks
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Key Questions This Study Will Answer
Source: Frost & Sullivan analysis.
How is the North American heavy-duty engine market expected to evolve, and what would be the
best-fit engine specification for future heavy-duty trucks?
How do OEMs compare, and what are the implications of the downsizing strategy adopted?
What are the downsizing strategies of key heavy-duty OEMs in North America?
What are the key market and technology trends driving the powertrain downsizing scenario?
How does powertrain downsizing fit into fuel efficiency improvement and emissions reduction?
Heavy-duty Truck Engine Market: Key Questions This Study Will
Answer, North America, 2011
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Research Methodology
Research Methodology:
Frost & Sullivan’s research services are based on secondary and primary research data.
Secondary Research:
Information is extracted from existing reports and project material within the Frost & Sullivan database,
including data and information gathered form technical papers, specialized magazines, seminars, and
Internet research.
Primary Research:
More than 15 interviews have been conducted over the phone by senior consultants/industry analysts with
original equipment suppliers, regulation authorities, and distributors across the globe. Primary research
has accounted for 80.0 percent of the total research.
OEM: North America
Paccar Inc.
Navistar Inc.
Mack Trucks
Daimler Trucks North America
Volvo Trucks North America
Supplier: North America
Cummins Inc.
MAHLE Powertrain
Eaton Corp.
Allison Transmissions
WABCO
Source: Frost & Sullivan analysis.
Supplier: North America
Johnson Mathey
Heavy-duty Truck Engine Market: Partial List of Industry Participants, North America, 2011
19 NAAF–18
Vehicle Segmentation
Source: US DOT, EPA, Frost & Sullivan analysis.
Vehicle Classification Definition
Gross Vehicle Weight
Ratings (based on U.S.
DOT Classification)
Light Commercial
Vehicles (LCV)
LCVs represent vans and light trucks. The typical
applications include pick-up and delivery, utilities,
airport operations, facilities management, and
several other vocational applications.
Class 1, 2, and 3
GVWR <= 14000 lbs.
Medium Commercial
Vehicles (MCV)
MCVs represent all types of mid-size trucks,
vans, and buses. The typical application includes
home delivery, logistics, parcel delivery, utilities,
waste and recycle collection, airport operations,
and small and medium school and transit buses.
Class 4, 5, and 6 GVWR
>14000 & <=26000 lbs.
Heavy Commercial
Vehicles (HCV)
This includes all types of large trucks. The typical
application includes line haul freight trucks, refuse
trucks, mining and construction trucks, and other
types of vocations that demand high GVWR
trucks.
Class 7 and 8
GVWR >26000 lbs.
The scope of the study is the Class 8 heavy-duty truck engine market
20 NAAF–18
Key OEM Groups Compared
OEM groups evaluated and compared in this study include the following:
Source: Frost & Sullivan analysis.
Group OEMs
Cummins Inc. Cummins Inc. North America
Daimler Group Daimler Trucks North America LLC
Volvo Group Volvo Trucks North America, Mack Trucks North America
PACCAR Inc. Peterbilt Truck Company, Kenworth Truck Company
Navistar Inc. Navistar International North America
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22 NAAF–18
Relevant Research
This research is supplemented by our completed and ongoing work in the global truck market, which include
the topics below:
• M657-18: Strategic Analysis of Global Low-cost Truck—Completed
• NA53-18: Strategic Analysis of Platform Strategies of Major Global Heavy-duty Truck OEMs—Completed
• N8CF-18: Strategic Analysis of Class 6‒8 Natural Gas Truck Market in North America—Completed
• NA5E-18: Strategic Analysis of the Global Bus Rapid Transit Systems Market—Completed
• NADC-18: Strategic Analysis of Chinese Hybrid and Electric Transit Bus Market—Completed
• M7BB-18: Strategic Analysis of Medium-Heavy Hybrid and Electric Truck and Bus Market in China and
India—Completed
• N9FF-18: Strategic Analysis of Medium-Heavy Hybrid and Electric Truck and Bus Market in North and
South America—Completed
• M783-18: Strategic Analysis of Medium-Heavy Hybrid and Electric Truck and Bus Market in Europe,
Middle East and Africa—Completed
• N818-18: Strategic Analysis of Growth Opportunities in Global Commercial Truck Industry 2010‒2020—
Completed
• N8AA-18: Strategic Outlook of the Western European and North American Medium- and Heavy- Duty
Commercial Vehicle Transmissions Original Equipment Market
Source: Frost & Sullivan analysis.
23 NAAF–18
Market Engineering Methodology
One of Frost & Sullivan’s core deliverables
is its Market Engineering studies. They
are based on our proprietary Market
Engineering Methodology. This approach,
developed across the 50 years of
experience assessing global markets,
applies engineering rigor to the often
nebulous art of market forecasting and
interpretation.
A detailed description of the methodology
can be found here.
Source: Frost & Sullivan research