Truck & Bus Manufacturing Industry Profile

The US heavy truck and bus manufacturing industry includes about 80 companies with combined annual revenue of about $15 billion. Major companies include PACCAR (Peterbilt and Kenworth); Navistar International; Daimler Trucks North America (Freightliner); Volvo Trucks North America; and the commercial truck division of Ford. The industry is highly concentrated: the top 20 companies account for about 95 percent of revenue.

The industry includes companies that manufacture and assemble complete vehicles and companies that supply vehicle chassis to assembly plants.

COMPETITIVE LANDSCAPE

Heavy truck demand is driven by growth in the agriculture, manufacturing, construction, and retail sectors. Bus demand is driven by growth in the number of school-aged children and investment in public transportation systems. The profitability of individual companies depends on volume and sales of high-margin options. Large companies enjoy economies of scale in purchasing. Small manufacturers can compete by offering highly customized products. The industry is capital-intensive: annual sales per employee are about $700,000.

Companies in the industry compete with makers of transportation equipment such as trains and planes, which also move freight and people over long distances. New trucks and buses face competition from reconditioned and used vehicles, since equipment may have a useful life in excess of 1 million miles.

PRODUCTS, OPERATIONS & TECHNOLOGY

Trucks and buses can be classified by gross vehicle weight rating (GVWR), a measure of the total allowable weight of a vehicle when fully loaded. Generally medium and heavy-duty trucks include ...