Concise summary of research findings from Frost & Sullivan's research focused on North American trailer technologies market

1. Strategic Analysis of North American Semi-Trailer
Advanced Technology Markets
Advanced Trailer Chassis, Safety, Aerodynamics, and Telematics Technologies To
Generate Revenues Worth $3 Billion by 2018
North America
Brief Summary
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July 2012

2. Contents
Section
Slide Numbers
Executive Summary
4
Research Scope, Objectives, Methodology, and Background
15
Definitions and Segmentation
20
Mega Trends and Industry Convergence Implications
24
Total Market
-
• External Challenges: Drivers and Restraints
33
• Semi-Trailer Technologies Market Analysis
41
• Forecasts and Trends
77
• Market Share and Competitive Analysis
106
Conclusions and Future Outlook
109
Appendix
112
Key Company Profiles
116
Voice of Customer Research- U.S. Fleet Managers Desirability and Willingness to Pay
for Advanced Truck and Trailer Technologies
135
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3. Research Objective, Scope, Methodology and Background
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4. Research Scope & Objectives
Base Year
2011
Study Period
2008 to 2020
Forecast Period
2012 to 2018
Vehicle Type
Semi-trailers: dry van, reefer, flatbed, tankers
Geographical Scope
North America
Semi-Trailer Technologies Market: Semi-trailer Production Unit Shipments, North America, 2012 - 2018
Year
Unit Shipments (Annual)
2011
217000
2012
248200
2013
255500
2014
255200
2015
247000
2016
242000
2017
240500
2018
242100
Source: Frost & Sullivan analysis.
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5. Research Aims and Objectives
Aim
The aim of this study is to research, analyze, and forecast the North American semi-trailer production and
technologies market.
Objectives
• Provide a strategic overview of the North American semi-trailer market. Including demand analysis, key
technology trends, market trends, market drivers and restraints in each geographical region.
• Determine market size and provide forecasts of trailer demand and breakdown by region.
• Provide forecasts of penetration rate, unit shipment, revenue, and pricing analysis of major chassis
(brakes, suspension and axles), safety systems (ABS, RSC, ATIS, TPMS, and etc), and Telematics
technologies.
• Competitor analysis: Analyze competitive factors, competitor market shares (OEMs), competitive
benchmarking, and product portfolio analysis.
Source: Frost & Sullivan research.
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6. Research Methodology
Research Methodology: Frost & Sullivan’s research services are based on secondary and primary
research data.
Secondary Research: Extraction of information from existing reports and project material within the Frost
& Sullivan database, to include data and information gathered form technical papers, specialized
magazines, seminars and internet research.
Primary Research: More than 10 interviews have been conducted over the phone by senior
consultants/industry analysts with original equipment suppliers, regulation authorities and Tier 1 suppliers.
Primary research has accounted for 80.0 percent of the total research.
Semi-Trailer Technologies Market: Key Industry Participants, North America, 2012
Key OEMs
Key Suppliers
Wabash National Corporation
Meritor Wabco
Utility Trailer Manufacturing
Meritor
Great Dane Trailers Inc.
Hendrickson
Hyundai Translead
Bendix
Stoughton semi-trailers
Haldex
Source: Frost & Sullivan analysis.
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7. Key Questions this Study Will Answer
Semi-Trailer Technologies Market: Key Questions This Study Will Answer, North American, 2012
What factors are impacting the North American semi-trailer technology markets?
What is the growth potential for the North American semi-trailer technology markets?
How will the changing trucking industry impact the semi-trailer market?
What are the current technologies and product portfolios of key industry participants?
What are the key market and technology trends for the semi-trailer industry?
Source: Frost & Sullivan analysis.
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8. Definitions and Segmentation
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9. Study Definitions
Geographic Scope
This analysis will focus on the North American Market:
• North America
• United States of America and Canada
Segmentation Scope
The analysis will focus on the following
applications:
1. Semi-trailer Market – OE
2. Semi-trailer Mechanical Systems Market –
Brakes, Suspension, Axles, semi-trailer
Aerodynamics
3. Semi-trailer Soft Technologies Market –Safety
Systems and Telematics
Definition of Unit(s):
• All figures are represented by one single unit
Definition of Prices:
• All prices are reported at the first level of
distribution from the supplier to semi-trailer OEM
• Prices are reported in US Dollars
Definition of Revenue:
• Revenues are calculated based on the number
of units and the price of a single unit
Forecast Assumptions (North America):
• Forecasts calculations are reported at the OEM level of distribution
• Forecasts for unit shipment and revenue of semi-trailer components are
calculated through using a weighted average of 2.15 axles per semi-trailer.
Source: Frost & Sullivan analysis.
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10. Definition and Classification: Semi-Trailer Type
Region
North
America
Definition
Dimensions
A semi-trailer is used to
transport freight. It has no front
axle and must be coupled with
a road tractor. In North
America the majority of semisemi-trailers have two
“tandem” axles, each with dual
wheels.
Name
Common Types
Maximum Width: 8.5 feet
Maximum Height: 13.5 feet
Most Common Length: 53 feet
Maximum Gross Weight Limit: 80, 000 lbs
Maximum Weight Per Tandem Axle: 34,000 lbs
Maximum Weight Per Singe Axle: 20,000 lbs
• Dry Van/Box
• Refrigerated
• Flatbed
• Tanker
Definition
Dry Van/Box
Dry van semi-trailers are the most prevalent type of semi-trailer used in the trucking
industry and is frequently used to carry dry products such as boxed goods.
Refrigerated
(Reefer)
Reefer semi-trailers are used to transport temperature critical freight such as
produce. Reefer units rely on an external refrigerator unit and specialty temperature
panels that keep the semi-trailer cold at all times.
Flatbed
Flatbed semi-trailers are used primarily to transport heavy cargo such as heavy
machinery and construction materials. Flatbed semi-trailers must strap their freight
down as it only consists of a load floor and removable side rails.
Tanker
Tankers are used to transport gases and liquefied freight such as crude oil. The size
and volume for tanker capacities vary widely as it typically ranges from 5,500 to
9,000 gallons.
Source: Frost & Sullivan analysis.
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11. Executive Summary
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12. Executive Summary—Key Findings
The Next Generation of Advanced Semi-Trailer Design has been Set into Motion
1
The proliferation of advanced semi-trailer technologies will be driven by three crucial factors:
strengthening regulatory environment, rising fuel prices, and an aging trailer population
2
Average age of semi-trailers in operation is 8.5 years with the market currently entering into its
replacement cycle as production is expected to reach 248,200 units in 2012.
3
Total revenues for the advanced semi-trailer technologies market is projected to be $ 2.16 Billion
dollars in 2012.
4
The significant impact of CARB’s mandate could result in the widespread adoption of semi-trailer
aerodynamics as market penetration is forecasted to reach 56 percent by 2018
5
The strict standards of CSA 2010 is stimulating the interest in safety systems such as automatic
tire inflation systems which is expected to have a 48 percent market penetration rate in 2018
6
While brake and suspension markets will generate nearly 60 Percent of total advanced
technology related revenues by 2018, and the penetration of aerodynamics improvement
technologies will increase over the 2012-2018 period, the fastest and strongest revenue growth
opportunities will be accorded by safety and telematics technologies
Source: Frost & Sullivan analysis.
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13. Executive Summary—Market Engineering Measurements
Semi-trailer Advanced Technologies Market Revenue Expected to Increase to $2.98 Billion by 2018
Semi-Trailer Technologies Market: Market Measurements, North America, 2012
Market Overview
Market Stage
Market Revenue
$2.16 B
Growth
3.9 M
(2012)
Base Year
Market Growth
Rate
(CAGR, 2012-2018)
Decreasing
Stable
(2012)
Forecast Period
Market Growth
Rate
5.50%
14.4%
Market
Units/Volume
Estimate
Market
Concentration
69%
(% of market share held by
top 3 companies)
Market Size for
Last Year of
Study Period
$2.98 B
(2018)
Number of Semitrailer OEMs
30
(active market competitors in
base year)
Increasing
Note: All figures are rounded. The base year is 2011. Source: Frost & Sullivan analysis.
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14. Executive Summary—Competitive Positioning of Key Industry Players
Semi-Trailer Technologies Market: Competitive Landscape, North America, 2012
Semi-Trailer
OEMs
Tier 1 System
Suppliers
Aerodynamics
Suppliers
Telematics
Providers
Wabash National
Meritor
Aerofficient
SkyBitz
Great Dane Limited
Partnership
Meritor WABCO
Freight Wing
ID Systems
Utility Trailer
Manufacturing
Hendrickson
ATDynamics
Qualcomm
Hyundai Translead
Bendix
Smart Truck
Star Trak
Stoughton Trailers
Haldex
Laydon
Composites
PAR LMS
Fontaine Trailers
Eaton
Ridge Corp.
Transcore
Source: Frost & Sullivan analysis.
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15. Executive Summary – Competitive Comparative Analysis
Competitive Advantage of Top OEMs Achieved Through Consistent Focus on the Introduction of Advanced
Semi-Trailer Technologies to the Market
Advanced
Technology
Integration
5
Advanced
Technology Market
Mover
4
3
Supplier Virtual
Integration
2
1
Trailer Body Material
Focus
0
Wabash
Telematics Focus
Great Dane
Utility
Advanced Safety
Focus
Aerodynamics
Enhancement Focus
Advanced Chassis
Technology Focus
Note:
•
Comparison based off of Frost & Sullivan analysis of market.
•
Indices are representative, and are for comparative purposes only.
•
Indices on scale of 5;1 being lowest, 5 being highest.
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Source: Frost & Sullivan analysis.
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16. Semi-Trailer Market Drivers and Restraints
Two Major Factors in CSA 2010 and Replacement Cycle Driving the Semi-Trailer Market in the Medium-term
Semi-Trailer Technologies Market: Key Market Drivers and Restraints, North America, 2012-2018
CSA 2010 driving
adoption of advanced
technologies
Aging semitrailer
population
Fuel price
volatility
Synergies
between truck and
semi-trailer OEMs
Favorable
freight
transport
trends
Fleets showing
greater demand
for soft
technologies in
semi-trailers
Drivers
Drivers
Denotes long-term impact
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Longer
Vertical integration
restricting market equipment life
cycle
penetration potential
for independent
suppliers
Restraints
Restraints
Too many advanced
technologies chasing
Volatile economic
too few consumer
environment
dollars
Denotes current impact
Lack of sufficient
legislative and ROI
support delaying growth
spurt in telematics and
safety systems
Source: Frost & Sullivan analysis.
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17. Executive Summary—Total Market Unit Shipment/Revenue Snapshot
Semi-Trailer Technologies Market is Expected to Reach $ 2.98 Billion in 2018
Semi-Trailer Technologies Market: Total Unit Shipment/Revenue Forecast,
North America, 2012 and 2018
Air Disc Brake
Axle
ATIS
~ $ 2,165,089,822
$115,539,246
Drum Brake
Aerodynamics
TPMS
Air Ride
ABS
Telematics
Spring
RSC
~ $ 2,984,804,379
$178,925,904
1,200,000
$191,548,350
$418,929,840
$122,474,290
1,000,000
$187,240,140
$972,756,750
Unit Shipment
$333,583,250
$412,780,500
800,000
600,000
$1,332,518,400
400,000
200,000
$429,187,936
$454,409,595
0
Braking
2012
Suspension
Axle
Aerodynamics
Safety
Technology
Braking
Axle
Safety
Suspension
Aerodynamics
Telematics
Note: Graph in center represents unit shipment data for 2012.
Outside graphs represent revenue for 2012 and 2018.
Telematics
Braking
Axle
Safety
2018
Suspension
Aerodynamics
Telematics
Note: All figures are rounded; the base year is 2011. Source: Frost & Sullivan analysis.
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18. Special Focus (Soft Technologies): Trailer Telematics Market Snapshot
Clear signs of development, as vast majority of trailer population is not penetrated. Increased opportunities for
telematics vendors to provide customized solutions and services to assist fleets with end-to-end asset visibility
Trailer Telematics Market : Trailer Telematics
Subscriber Penetration (North America), 2012 & 2018
Trailer Telematics Market : Product and Service Range
(North America), 2012
Trailer Population
Entry Level
Trailer Telematics Subscriber Penetration
8,000,000
Hardware Cost
$200 - $350
Range ($)
Mid Level
High End
$350 - $550
$740 - $1400
$10 - $20
$20 - $35
6,930,750
Trailer Population (Million)
7,000,000
Service Cost
Range ($)
6,305,000
6,000,000
$4.5 - $10
Note : The above is the market average selling price
(vendor  buyer) of hardware and services
5,000,000
Trailer Telematics Market : Key Market Participants
and Communication Technologies (North America),
2012
4,000,000
3,000,000
Supplier
Major Telematics
Solution Providers
2,000,000
1,000,000
Manufacturer
SkyBitz, ID Systems, Qualcomm,
Star Trak, PAR LMS, TransCore,
Thermo King and others
Communications
Technologies
Satellite > Cellular > Wi-Fi > Multimodal
20.0%
14.0%
0
2012
2018
Year
Note: All figures are rounded; the base year is 2011. Source: Frost & Sullivan
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19. Executive Summary—Key Conclusions and Future Outlook
Parameters
•
Market Status
•
•
Semi-trailer OEM
Competition
•
Future
Expected to have a steady growth without
any sudden spikes as recessionary
environment still persists
Advanced semi-trailer market is in the launch pad for
robust growth in unit shipments and revenues
Almost 80% of the market is consolidated by four
players (Wabash, Great Dane, Utility, Hyundai
Translead)
20% of market is highly fragmented (Fontaine,
Stoughton, Vanguard, and others)
Aggressive competition from current top
market leaders looking to provide complete
advanced semi-trailers to end-users.
•
Growing awareness and interest advanced semi-trailer
technological solutions to combat government
regulations and rising fuel costs
Solutions
•
Value Proposition
•
Barriers to Entry in
North American
Market
Current
The potential size of the total market is vast and not
fully penetrated of the 6.4 million semi-trailers.
Suppliers: Nascent market with intense competition
among market participants challenging for market
positioning
Fleets: Improved productivity, asset monitoring,
operating cost and fuel economy
Major portion of the market is consolidated with semitrailer OEMs and tier 1 suppliers, creating big hurdle in
creating brand identity
Low expectations from fragmented market
group
Higher levels of awareness among end
users pushing technology penetration
levels towards mid and high levels
•
Ability to offer customized solution for
various fleet operations and situations
•
Prognostics and preventive maintenance
helping fleet achieve optimal efficiency
Low cost and quality semi-trailer
technologies not expected to be able to
penetrate the market
Source: Frost & Sullivan analysis.
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20. Market Trends
Economic Environment Weighing Heavily On Trailer Advanced Technologies Market
Semi-Trailer Technologies Market: Market Trends, North America, 2012–2018
Product quality, price, financing
options and after purchase
service becoming the
competitive factors among
OEMs.
The continued growth of the
semi-trailer market will depend
heavily on the recovery of the
overall economy
All market participants facing
downward pressure on prices
from highly price sensitive endusers.
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Reefer semi-trailers are
expected to experience slow
growth due to the impact of the
Food Safety Modernization
Act.
Market Trends
Semi-trailer production volume
expected to experience short
term growth as the current
lifecycle of a large chunk of
semi-trailers is nearing its end
The market is currently not
experiencing growth but a
“recovery” from a recessionary
environment and equipment
replacement needs
The boom in the natural gas
industry could fuel a surge in
tanker trailers
Recessionary environment
encouraging the use of mobile
resources to optimize fleet
operations and logistics
Source: Frost & Sullivan analysis.
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21. Technology Trends
Growing Awareness of Semi-Trailer Technology Expected to Result in Increasing Adoption
Stringent emission and fuel
regulation impetus will drive
R&D and the adoption of
innovative semi-trailer
technologies
Semi-trailer OEMs to offer
“intelligent semi-trailers” that
provide fleets added
performance, theft prevention,
real time data from telematics,
and safety enhancements
Vertical integration and
modualization of semi-trailer
components are expected to
become industry standards
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Increasing installation of safety
technologies such as TPMS,
ATIS, RSC, and advanced
braking technologies on
upcoming generation of semitrailers
Technology
Trends
The productive lifecycle of new
semi-trailers reaching 15 years
if properly maintained
New technologies will require
maintenance technicians to
adapt and learn new repair
procedures
Semi-trailer OEMs to increase
focus on lightweight semitrailers through enhanced
designs, materials and lighter
components to ensure greater
payload and productivity.
Increasing trend towards
synergistic collaboration and
technology development
focused virtual integration
between semi-trailer OEMs and
component suppliers
21

22. The Last Word—Five Big Predictions
1
The level of distributed electronics is trailers is increasing benefiting trailer safety,
connectivity, and management. This will necessitate creation of electronic interfaces with
key trailer systems and sub-systems. Trailer telematics poised for rapid organic growth.
2
Untethered trailer power management and creation of multiplexing of electronic
communication infrastructure in trailers for better intra-trailer and trailer-tractor
communication will emerge as key R&D focal points for trailer OEMs and suppliers.
3
Diesel fuel volatility and strengthening regulatory environment will lead to fleet managers
and owner-operators pull advanced technologies than OEMs pushing them.
Recessionary/slow growth economic environment to continue posing hurdles to rapid
market adoption.
4
OEMs will use advanced technologies to differentiate products from competitors. However,
too many technologies chasing too few consumer dollars will make it difficult for OEMs to
choose the right set of technologies for vertical integration.
5
Advanced trailer technologies market to grow at 5.5 Percent CAGR indicating additional
revenue generation equivalent to $0.82 Billion within the 2012-2018 period
Source: Frost & Sullivan analysis.
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23. 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
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