Truck sales are stagnating in the Triad markets (Japan, North America, and Western Europe), with little or no growth expected beyond the current recovery. By contrast, developing markets such as Brazil, Russia, India, and China (BRIC) have experienced tremendous growth over recent years and still offer huge growth potential. The BRIC markets, which accounted for one-third of global truck sales in 2000, are likely to contribute two-thirds by 2020.
In addition to volume growth, the truck industry in the BRIC markets will see continuous professionalization. Changes in customer and legal requirements mean that most of today’s low-cost trucks are likely to be replaced by upgraded vehicles offering greater sophistication—at prices 20 to 50 percent higher.
Such upgrading should create considerably more revenue and profit potential in the BRIC markets. Global OEMs from mature economies and local OEMs from developing economies are competing for this highly attractive, newly emerging segment.
In this report, the third in the series Winning the Localization Game in the Automotive Industry, The Boston Consulting Group presents the challenges truck manufacturers will face over the coming decade. On the basis of interviews with more than 75 senior executives from the world’s leading truck manufacturers and suppliers, the report analyzes optimal strategies for excelling in BRIC commercial-vehicle markets. It also compares current strategies and business models and analyzes their potential to be the winning models of the future.