’98 an exciting prelude to ’99

Article December 28, 2000
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This year clearly ranks as one of the most exciting in the history of the truck business. I’d say it runs far ahead of whatever is in second place. Sales have been booming for the manufacturers and demand for trucking service has made 1998 a great year for operators.

An explosion of global developments made it a remarkable time for students of the industry. Truck shows became the tail that just about started wagging the truck industry dog. There were lots of new products plus continued changes in regulations.

There were new lines of trucks and new alliances of suppliers. Just about everything had changed as the year moved to a close. Truck service people noted one exception—the vehicles continue to run on tires which are not quite round.

The prosperity of truck makers and operators, with sales at near-record levels, is fairly easy to explain in view of the generally robust health of the economy. And, as is frequently the case when the truck business is healthy, there were some clouds over the business.

The General Motors truck lines, Chevrolet and GMC, were worried in mid-spring about how they could meet demand for 1998 trucks. A labor dispute in the summer virtually shut down the company and dimmed 1998 prospects.

GM had no monopoly on troubles. Freightliner had to call on facilities in Mexico to help the line keep up to demand in the U. S. and trailer makers found that repair work after El Niño storms in early 1998 soaked up much of the available supply of plywood used to line new trailers.

Business makes the world go ‘round

Growing worldwide competition in the truck market is a fact of business life which became more apparent during 1998. The merger of Mercedes Benz, the world’s largest producer of heavy trucks and Chrysler Corp., the No. 3 company among the American automotive Big Three, was the big move.

Mercedes Benz didn’t stand pat on the Chrysler announcement but indicated that it will be selling some of its vast assortment of components to other truck makers. The company has one of the industry’s most extensive programs for producing components for use in its trucks.

Both Freightliner and Sterling are already using some Mercedes components.

In addition, there was a repeated report that Mercedes Benz is about to enter into a cooperative agreement with one of the larger Japanese truck manufacturers.

Meanwhile, Freightliner Corp., a Mercedes Benz subsidiary here, was absorbing Ford’s heavy trucks, using the Sterling name. At the same time, Bering Truck with a Korean backing, unveiled its line here. You have to go back to the Roaring ’20s to find a time when the truck industry expanded so much in one year.

Not all of the developments increased activity here. Ford moved its medium truck production to Mexico as Navistar International was opening a brand-new factory for medium and heavy trucks in Mexico.

At the supplier level, Meritor, which started business in early 1998 after being spun off by Rockwell, acquired a components operation from the Swedish manufacturer, Volvo.

Gimme one of those, six of these . . .

Acquisitions popped up everywhere through 1998. It was often a case of the big getting bigger as it began to appear that only the large would be able to prosper in the high-tech, highly competitive, global automotive market of the new century ahead.

Recent history of two major truck component suppliers, the Eaton-Fuller operation and the Dana-Spicer complex, is an interesting case in point. The two exchanged a number of product lines in a complex deal that gave no clear indication which one came out ahead.

Clearly, each one emerged set up to offer a more complete line of truck components; both supply parts for light-duty trucks and passenger cars as well as heavy-duty trucks.

The sale of a sophisticated, electronically controlled transmission for a heavy-duty truck can bring in far more dollars than the sale of any one part for a car or light truck. But those gear boxes sell by the dozens or hundreds while car or light truck parts sell by the thousands or even millions.

There was no major change in the hot items among big truck components during 1998. High horsepower diesels continued to supply much of the industry’s sizzle.

Observers wondered what will happen now that Caterpillar, long a maker of big power, has acquired England’s Perkins line, often ranked as the world’s diesel leader.

Easy-shifting transmissions with high driver appeal continued to draw considerable attention in 1998, although the pace was a bit below that of 1997. Anything that attracts or retains drivers is a likely winner through the foreseeable future.

No longer few and far between

Truck shows are multiplying and boosting their influence. The ones that survived a period in which shows were few in number will face vastly increased competition through 1999.

The Mid-America Trucking Show in Louisville, the nation’s largest lately, will be back this coming spring to be followed next fall by a show in Dallas with some of the same sponsors. The Dallas show has already been rescheduled once because of the large number of potential exhibitors.

Shooting for a comeback in the West in 1999, the International Trucking Show will be staged again in Las Vegas.

Before 1999 is complete, initial truck shows are scheduled for Atlanta and Nashville.

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