Daimler Truck North America (DTNA) supports the move to zero-emission vehicles, but getting there must be done “at the speed of right.”
That turn of phrase, coined by DTNA, was cited by David Carson, DTNA’s senior vice-president of sales and marketing, who was a keynote speaker at FTR’s Transportation Conference in Indianapolis, Ind.
Keynote speaker David Carson (right) of DTNA. (Photo: James Menzies)
“Whatever path we take has to make sense for the industry,” he said. We have medium-duty battery-electric vehicles and heavy-duty battery-electric vehicles, but the overall system to make sure those trucks can operate in the commercial vehicle industry is not fully developed. The biggest weakness there is charging infrastructure. We can’t do that lift. That lift has to be done by utility companies and governments.”
He said mandating zero-emission vehicles should be accompanied by major investments in charging infrastructure, “and at the moment there’s a massive gap in that, and it’s causing big problems.”
Carson also said multiple technologies will be required to meet the industry’s needs, including hydrogen fuel-cell-electric and perhaps internal combustion hydrogen engines, in addition to battery-electric.
“You can stack more batteries in a battery-electric truck and get more range, but that reduces payload and is an exercise in futility,” he said of some applications. “We understand most of our customers don’t want to see a flavor of the day.”
Supply chain issues evolve
When it comes to its present product line, Carson said supply chain-related parts shortages have been resolved. Nearshoring – bringing parts production closer to North America, mostly by way of Mexico – has been helpful, he added.
But new challenges have emerged. Cyberattacks, acquisitions and divestitures, and plant fires have all created problems for truck makers.
“Overall, the supply situation has improved, but I don’t think we can say we’re never going to see another disruption again,” Carson said.
As manufacturers brace for an anticipated spike in demand ahead of costly EPA27 emissions rules, Carson said learnings from the Covid-related supply challenges will prove useful. One such takeaway from that time is to work more closely with suppliers and offer forecasting transparency.
This allows suppliers to better plan and manage staffing and capital investment requirements. “We spend a lot of time with our supply base helping them understand [the market],” Carson said. “If we have little dips [in demand] we don’t want them to take shifts off and lay people off, because it takes too long to come back up. We want to be close to them so we can moderate that.”
Truck makers also face a risk suppliers of technologies like microchips could allocate supplies to entirely different industries.
“The Covid microchip crisis, we’re through that,” Carson said. “What we might have is an issue where the microchip industry is more interested in focusing on cloud computing and AI than they are on the automotive and commercial vehicle industries. We have to make sure our purchasing power is not ignored or put on the sideline.”
Nearshoring risks
And while nearshoring is a benefit for truck manufacturers serving the North American market, it also comes with its own risk, Carson acknowledged. With a U.S. election looming, Caron noted it’s critically important that free trade is maintained between Canada, the U.S. and Mexico.
There’s also been the arrival of China-built commercial vehicles in Mexico.
“As they enter Mexico, they have no dealer network in Mexico whatsoever. They can sell products and have no ways to service them.”
If those trucks are distributed in the U.S. and Canada, there could be problems, Carson warned.
“We know that Chinese products in the U.S. and/or Canadian markets would have pretty significant consequences and threats to what we have in the industry today,” he said.
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