autonews ibm truck 2020 webinar presentation 11-13-2009

Truck 2020: Transcending Turbulence

Thank you for participating and completing the online survey… results and answers to webinar questions at:

http://truck2020.blogspot.com

Also, keep following study related posts athttp://twitter.com/kalgyimesi

Welcome

Peter Brown

Associate PublisherAnd Editorial Director

Automotive News

Sanjay Rishi

Vice President and Global Automotive Industry Leader

IBM Global Business Services

© 2009 IBM Corporation

Truck 2020: Transcending Turbulence

Sanjay Rishi / IBM Global Automotive LeaderCalstart HTUF / October 28, 2009


Interviews included the entire trucking value chain, multi-modal operators, industry regulators and associations

Truck OEMs Truck Suppliers Value Chain

Fleets Bus OEMs Regulators Associations Others

Group Lenormand

Chongqing Heavy Vehicle Group


Our interviews were global and comprehensive

Interviews by Industry Segment

� 60% - OEMs and suppliers

� 8 of the top 10 OEMs, that includes

over 85% of total volume

� Other interviews include; regulators,

dealers/bodybuilders and multi-modal

operators

Interviews by Region

� 91 executive interviews completed

� 13 countries

� Emerging countries accounted for

16%: Eastern Europe, Brazil, Russia,

India and China

OEMs

35%

Suppliers

25%

Others

18%

US/Canada

39%

Western

Europe

25%

Japan

20%

EBRIC

16%

Value

Chain

13%

Fleets

9%


By 2020, there will be radical changes in the pressures facing truck executives compared to the issues they are addressing today

2009 2020

70%

61%

45%

48%

32%

15%

12%

15%,

71%

48%

54%

36%

28%

25%22%

9%

Technology Progress

Globalization

Economic Stability

Sustainability Concerns

Government Influences

Corporate Social Responsibility

Global Labor

Force

Urban Development

What are the most important external forces

impacting the industry Today and in 2020?

Decreasing Trends

Increasing Trends

“Our business will change drastically as the basics of our economics and ecology

is radically altered”–European Truck OEM


The impact of the current economic crisis will subside, but could have longer implications for those who have failed to invest

28%

70%

Economic StabilityTruck production volume has seen the largest decreases on record over the last 8 months

… but, there may be residual effect from the

economy. Companies deferring investment

leave themselves at risk when growth resumes

Executives largely agree that these events will

abate over time and the industry will focus on

growth for the future…

2009 2020


The monumental changes facing the industry require truck producers to navigate the road ahead carefully

Globalization efforts will be

a force through the decade…

…as the vehicle’s Brand is

increasingly commoditized…

…but embracing technologywill be a clear path forward…

This transition requires a new enterprise

and different workforce

…while new markets, partnershipsand focus to service offers growth


While the surge toward globalization is building, the path and speed of that transformation is less certain

What are the most important external forces

impacting the industry Today and in 2020?

2009 2020

48%

54%

Globalization55%

31%

“There are too many differences regionally for globalization to work for this industry”

–US Supplier

Truck 2020

Automotive 2020

“Suppliers and Auto OEMs are successful because they embraced globalization. Truck OEMs need to do this urgently”

–Japanese Truck OEM


-1 0 1 2

Purchasing decisions will be based on regulatory and value issues, rather than brand loyalty

Rate the Change in Vehicle Buying Criteria 2008 � 2020

Unchanged

Fuel Efficiency

Eco-friendly

Traffic congestion

Personalization

Safety

Reliability

Price

Brand

Values of Company

Configurability

Credit & Financing

Total Cost of Ownership

IncreasingDecreasing

Fuel Efficiency, Total Cost of Ownership, and Eco-friendly criteria are

increasing in importance

Brand of the vehicleis becoming much

less important


The developed markets, with established brands, recognize the vehicle is being commoditized

-1 0 1 2Unchanged

Fuel Efficiency

Eco-friendly

Traffic congestion

Personalization

Safety

Reliability

Price

Brand

Values of Company

Configurability

Credit & Financing

Total Cost of Ownership

IncreasingDecreasing

Breakdown of BRAND by Market

-1 0 1

–0.3, n=76Developed

1.2, n=15Emerging

Unchanged

The developed markets agree the

brand is losing importance


There is broad agreement across markets and industry segments that the vehicle’s brand is diminishing in importance

-1 0 1

Breakdown by Market

W. Europe

US/Canada

Unchanged

Japan

Emerging

–0.7

–0.2

-1 0 1

Breakdown by Segment

–0.8

OEMs: Developed/Emerging

Suppliers

Unchanged

Dealer/Body

Others

Fleets –0.5

–0.41.25

“Brand reduces in importance as more similar products enter the market”

–Indian Truck OEM

Brand diminishment was validated in Europe, US,

OEMs in developed countries, suppliers and fleets


Truck manufacturers must transition from a brand image centered on the vehicle to one that addresses the larger transportation solution

Navigation / Routing

Service Contracts

Vehicle

“The differentiation won’t be on products, but on services”–European Truck OEM

+

+

Today vehicles are sold with

non-integrated add-ons

By 2020, the value will be in

integrated solutions

Integrated Telematics

Bundled Services

Comprehensive Serviceability

Advanced Vehicles


Innovation in the vehicle will remain important as investments center on connectivity, emissions and fuel economy

Rate the Level of Innovation in various

aspects of the vehicle by 2020

Low High

“The development of software is much more important than hardware”

–Japanese Truck OEM

2.5

2.6

2.6

2.7

2.8

3.1

3.9

4.2

4.4

4.4

1 2 3 4 5

Body Structure

Interior

Chassis

Body Exterior

Trailer/Load

Braking Systems

Pow ertrain

Engine & Auxiliary

Systems

Softw are

Electrical

Systems/Electronics


Telematics will impact everything about the vehicle and its usage

Service• Remote and faster diagnostics, reducing service time

• Prognostics, managing PM cycles and proactive servicing

Safety• Navigation

• Speed control approaching curves, exits and turns

Driver Assistance• Route navigation, geofencing, notice of rest, fuel or service areas

• Electronic payments - toll, drive thru, parking, road charging

Regulatory Compliance• Determining what roads and boundaries that the vehicle can go

• Auto identification and reporting of non-compliance

Sustainability• Managing fuel economy through navigation and driver information

• Switching to different power modes based on regulations


Technology is also critical in addressing the issues of oil…

100m long

100m wide

396m deep!

…81% of US oil imports could be eliminated

if all cars and trucks were fully electric

Daily US Oil consumption represented as a lake…

Energy and Transportation

Consumption in the US

LightVehicles

51%Trucks

30%

Air13%

Other6%


Hybrid vehicles offer the best overall opportunity for more efficient energy usage

1.9

0.9

1.0

2.7

Light Vehicles Relative to Gasoline

Heavy Vehicles Relative to Diesel

1.0

1.0

2.3

3.0

Gasoline/diesel plus ethanol and biomass blends

Compressed and liquefied natural gas

Energy Efficiency Ratio Comparison

Efficiency of each source based on cumulative effects

associated with producing, transporting, and using fuel…

Hydrogen in a fuel cell

Electricity in a battery or plug in hybrid electric


Hybridization will be

applied far and wide…

Solutions will come from many places, but hybridization will make the biggest difference by 2020

Alternative fuel technologies develop as infrastructure is built out

Retrofittingexisting fleets should

be encouraged

� CNG

� LNG

� Methane

� Plug-in hybrid

� Hydraulic hybrid

� Some applications can be electric

� With as much incentives as new production…


The US is in an outstanding position to lead this transformation

We have the

entrepreneurshipWe have the

innovationWe have the

incentive

� More small emerging suppliers

� Venture capital investment

� Outstanding innovation culture

� Many hybrid solutions are being tested here

� US is enabling stimulus explicitly for hybrid trucks

� State-based stimulus helps further


The combination of technology, solutions and partnerships will lead to differentiating business models

packaged into

solutions…

Enabling

technology…

…built through

partnerships


The combination of technology, solutions and partnerships will lead to differentiating business models

packaged into

solutions…

Enabling

technology…

…built through

partnerships

• Fully electric

• 60,000lb Load

• Recharge in 30 min

• Price as conventional vehicle

• Deferred fuel annuity

• Battery swap warranty

• Partner based on applications

• Establish preferred transport green routes


Industry ecosystems must align to address environmental, regulatory and customer concerns

Truck and Bus

Government- Transportation

- Energy- Safety Energy /

Utilities

Telecommunications

Other Industries- Financial Services- Biotechnology

- Retail / CP

Automotive- Light Vehicle

Electronics- Software

Performance Optimization

Plug in Hybrid Recharging


Cross industry partnerships will be instrumental to some of the biggest issues facing the industry

Truck Mfg / Fleets

UtilitiesGovernmentTransition to Plug-

in Hybrid Fleets:

Truck Mfg / Fleets

Shipping / Barge

GovernmentIntermodal

Optimization:

Truck Mfg / Fleets

RetailersGovernmentUrban Traffic

Management:

Finance

Rail

Utilities

“The industry doesn't realize yet how much it

needs to change”–US Industry Organization


0% 20% 40% 60% 80% 100%

Finance

Procurement

Production

Software Development

Leadership

Service Technician

Product Planning

Marketing / Selling

Engineering

This transformation requires a new enterprise and a fundamentally different workforce

Rate the most critical skills

for the industry in 2020

Truck 2020

Automotive 2020

“The truck enterprise of the future has to be positioned differently in the market”

–European Truck OEM

“Leadership is especially critical in a distributed workforce”–North American Integrator


The future will be exciting for the truck industry and the industry must seize the moment

� To globally integrate or regionally specialize? This is the dilemma for truck manufacturers

� Brand of the vehicle is being commoditized, truck manufacturers will have to evolve their definition of brand and develop solutions

� Telematics is your most important investment for the future

� Hybrid truck development is critical for the future, particularly given increased urbanization globally

� The US is leading this innovation and must continue to invest to maintain this lead

� Truck manufacturers must aggressively expand their thinking about partnerships beyond traditional industry boundaries

� The winners by 2020 will have significantly transformed their workforce

Bill Van Amburg

Senior Vice President

CALSTART

HTUF 2009HTUF 2009

Hybrid Truck Users Forum (HTUF)

� User-driven process to commercialize medium- and heavy-duty hybrid trucks

� Joint CALSTART-U.S. Army program (RDECOM-TARDEC-NAC)� Also supported by Hewlett Foundation,

support from DOE, DOT

� HTUF focuses on commercializing hybrid trucks with dual-use benefits � Speed commercialization and reduce

overall costs by creating common fleet requirements, joint purchase commitments, increasing volumes

More than 80 National Fleets and All Major Truck Makers & System Suppliers involved (partial list)

Key Take-Aways From HTUF 2009

� Hybrids are real – in first, low-volume production (but low volume means higher cost)

� The applications are expanding – big growth in chassis/body combinations

� Hybrids bring big energy security, economic and emissions benefits: reduced fuel use, lower emissions and US manufacturing and engineering jobs

� U.S. currently is the leader in this technology –though competition is growing

� Public partnership to speed this industry would be useful – helping fleets buy to increase production is biggest help

Regional Heavy & Line Haul Hybrid Trucks

� Kenworth, Peterbilt, Navistar and Freightliner all have Class 8 regional haul tractors (up to 55,000 GVWR single axle)� All developing next generation advanced Class 8 – including

electric and hybrid configurations

� Mack showcased advanced hybrid line haul Class 8(full 80,000 lb GVWR); next stages add more electrification

Hydraulic Hybrids Coming of Age� Several pre-

production and near production models shown: Eaton, Bosch Rexroth, Parker

� Parallel and Series architecture

� FCCC – Parker series parcel strip chassis showed impressive integration, potential fuel savings

Emergence of Serious Electric Platforms

� Freightliner Custom Chassis and Enova showcased

� Joins: � Navistar/Modec

(production Q1 2010)

� Ford/Azure (Transit Connect, 2010)

Hybrid Trucks Now Entering Market

DevelopmentPre-Production

Production IntentEarly Production

Test prototypes and systems

Field pilot assessments (10-50 vehicles)

Assembly line builds up to 100+

Initial commercial volumes – still high incremental cost

TO

OL

S:

R&D Support

Pre-Production Deployment Support (HTUF)

Purchase Incentives

Hybrid introduction 10 years behind cars but industry is real, momentum growing

Hybrid Truck Technology Critical to U.S.

� Hybridization provides significant immediate benefits� ENERGY SECURITY: Reduced fuel

consumption (30-50%)

� EMISSIONS/CLIMATE: Reduced criteria (NOx) and GHG emissions (10-60%)

� One of few strategies to improve on 2010 emissions reductions

� ECONOMY: North American leadership in technology, manufacturing

Fuel consumption reduction from HTUF field testing data

Reductions come just from

hybrid system, no additional

after-treatment

CO2 reductions closely

tracked fuel reduction

percentages

Emissions/fuel reduction from HTUF dyno testing data performed at SwRI

Hybrid Trucks at “Tipping Point”

� Hybrid truck production volumes are

still too low in early market to realize

price reductions

� However: modest volumes can move prices to within business cases needs: Need 3,000 - 5,000 driveline units/year

� Industry Needs:

� Long term R&D – energy storage,

efficient components, integration

� Pre-production funding (10-100

vehicles per application)

� Commercially-focused purchase

incentives

Lessons from Hybrid Launch

� Truck world is changing rapidly – hybrids and advanced trucks are the first salvo

� Users needs and demands are changing rapidly –energy efficiency, emissions, sustainability rising

� Trucks of the future will require very different technologies for powertrains, components, vehicle management and operation

� Truck makers will need new skills, non-traditional suppliers and business models to address these changes – it is becoming a high-tech industry

� U.S. currently is the leader in some of these first technologies – though competition is growing

� A multi-year suite of US strategies, investments and policies to support truck industry change is needed

Michael Stark

Senior Technical Sales Manager National Accounts

Freightliner Custom Chassis Corporation

Michael Stark

Daimler Trucks North America

CleanDrive Technologies Globalization

Daimler Commercial Vehicle Sustainable Mobility

Light

Duty

Trucks

Asia

Market

Hybrid

Technology

1

Global Hybrid Center

First steps done. Further success factors to be investigated in next year

Material costs

� Modular componentsSystem platform with scalable components, e.g. derive Medium Power system using Light & High Power system

� Technology enhancementsTechnology improvements for material cost reductions

� Vehicle packagingEnlarge max. addressable vehicle volume

� Target costingStrong Involvement of suppliers for cost reduction

Fuel savings

� HEV componentsDefine optimal HEV components for max fuel saving potential (design to point)

� Operation strategyDevelop optimal vehicle and application HEV operation strategy

� Investigations to be

extended on

-component specification

High-power System

- Packaging concept

improvement

- concept competitions

with suppliers

Major levers Measures Need for action

A3Conclusion

Two modular hybrid systems defined Medium and Heavy Duty Application s

InputApproach Results

• Reference Vehicles

MD: (M2)

• Load profilesEmpty: 0 % payload

Semi loaded: 60 % payload Fully loaded: 100 % payload

• Route profilesHighway: Atlanta-Memphis

RTInterurban: Sysco FoodsCity cycle: Nestle/FedEx

• Energy analysis- Based on input data

approach used to calculate optimal fuel saving potentials for each vehicle**

- Fuel saving potentials used as basis for HEV

systems definition

94Number of cells

2,4nom. Capacity [kWh]

32 - 50effect.

peak

const.

55

23Battery

Power [kW]

Voltage [V] 360

Hig

h P

ow

er

Syste

mM

ed

ium

Po

wer

Syste

m

188Number of cells

4,8nom. Capacity [kWh]

65 - 100effect.

peak

const.

110

45Battery

Power [kW]

Voltage [V] 720HD: (Cascadia)

Example: MDHighway: 52 %*

Interurban: 26 %*

City cycle: 22 %*

Empty: 30 %* at 6tSemi loaded: 45 %* at

9,6t Fully loaded:100 %*

at 12t

• Limiting factors for system layout

are- legislation

(max. voltage 750V)- available technology for

battery(cell output limited)

- available technology for inverter

Looking Forward

Hydraulic HybridAdvanced “Engine Off” Feature

50% - 70% increase in MPG

All-electric Plug-In VehiclesZero emissions- $0.08 - $0.10 per mile energy cost

vs. $0.25 - $0.48 per mile for comparable diesel or gas Vehiclen

DTNA Global Family

Thank You

Visit this webinar

on demand at

www.autonews.com/webinars

Thank You

autonews ibm truck 2020 webinar presentation 11-13-2009

Documents