China truck growth could help U.S. fleets cut cost

A new analysis of China's commercial truck market finds that demand for heavier chassis and cleaner diesel engines will spike over the next five years, offering potentially big revenue-generating opportunities for U.S. and European truck makers. And that positive result could also benefit U.S. truck  fleets by  lowering the cost of emission control technologies.

According to the report due out next week from research firm Frost & Sullivan titled "Strategic Analysis of the Chinese Commercial Vehicle Market," that country's commercial truck population is projected to expand from 1.92 million units in 2008 to over 2.68 million units by 2015 – resulting in a compound annual growth rate of 4.9%. That growth is being driven by several factors, including new roadway weight limit rules, increased fuel taxes, and the harmonization of China's truck emission statutes with those of the U.S. and Europe, said the report.

The end result, noted Sandeep Kar, program manager &senior industry analyst with Frost & Sullivan's North American automotive & transportation practice, is that China's truck manufacturers are increasingly looking to forge partnerships with U.S. and European truck OEMs to gain design expertise in fuel economy and emission control systems.

By extension, Kar told FleetOwner, economies of scale gained from such joint ventures could  lower the global cost of producing emission control system components-- possibly leading to price reductions for such system from U.S. and European truck markets.