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Steady vocational market driving Mack’s growth

Mack’s market share reaches 10-year high as overall Class 8 demand shrinks


CHARLESTON, S.C. — In the first quarter of 2017, Mack Trucks reached its strongest share of the Class 8 truck market in more than a decade.

It claimed 10.4% of the US market and 10.1% of the combined Canada/US market, improving on its previous 10-year high reached in the first quarter of 2016. The slowdown in Class 8 order activity over the past year has been most acute in the on-highway sleeper segment, while vocational truck sales have actually increased year-over-year, playing right into Mack’s hands.

“I think, this past cycle has been all about the segments,” said Dennis Slagle, executive vice-president, Volvo Group, and president of Mack Trucks, when addressing trucking journalists at a Mack Trucks Born to Haul press event. “You had this loud correction in the long-haul sleeper segment of the market, day cab was also hit hard but not as hard, and vocational year-over-year has grown. The way we segment it, about 75% of the market is in contraction and the other 25% is quite good, and that kind of mix plays to Mack’s strength. We’ve enjoyed quite a bit of momentum, particularly during the first quarter.”

Mack’s market share hit a 10-year high in the first quarter.

Last year, the industry-wide challenge was to work through excess inventories.

“Everybody in the industry, including Mack, has been successful in reducing that inventory down to a healthy level,” Slagle said.

The high inventories dealers were saddled with last year meant the drop in Class 8 order activity didn’t reflect the true appetite for new trucks.

“The market was there,” Slagle explained. “It wasn’t that people weren’t buying; it was good enough to get inventories down to safe levels…We’ve gone through that part of the cycle now, inventory industry-wide is at a good level, and we can start looking forward to factories building for the demand rather than factories building less because companies are trying to reduce inventories.”

Last year’s market totaled 243,000 Class 8 trucks in North America, and Mack is projecting 215,000 for this year. But, Slagle added, “the underlying demand feels a bit healthier than it did last year.”

Slagle said a business-friendly administration in Washington should drive stronger demand for new trucks.

Jonathan Randall, senior vice-president, sales, Mack Trucks North America, said Mack’s strongest results in a decade came from maintaining its leadership position in the construction segment and growing its regional haul presence. The company is now looking to strengthen segments such as long-haul, where it’s not as prominent.

It’s also a result of improving the service experience for customers, specifically through GuardDog Connect remote diagnostics, and the rollout of certified uptime centers. Randall said Mack now has 55,000 trucks connected through GuardDog Connect and 91 certified uptime centers, which implement processes to expedite repairs. Even small repairs used to take an average of four days to complete, but certified uptime centers have reduced that “dwell” time to two days.

GuardDog Connect is about shifting from a reactive to proactive repair mindset, explained David Pardue, vice-president, connected vehicles and uptime services with Mack. The Mack OneCall Center analyzes fault codes and advises the operator on the best course of action. When the truck arrives at the dealer, it is pre-diagnosed with a repair plan in place so that it gets back on the road faster. Geofencing is used to track dwell time and Mack intervenes when dealers aren’t meeting expectations. The entire repair process is tracked through the ASIST online portal.

“We’re seeing improvements in dealer efficiency,” Pardue said.

Mack says the MP8 engine delivers big bore power in a smaller package.

“We can now measure it,” added Slagle. “What you can measure, you can manage.”

Mack’s latest tool with which to improve uptime, is over-the-air engine software and parameter programming. The company is allowing fleets to receive software updates remotely without visiting the dealership, doing in approximately 30 minutes what would traditionally incur two days of downtime. This benefits both fleet managers and drivers, Pardue pointed out.

But Slagle said Mack won’t be eliminating human interaction through the process.

“When we start going full throttle with over-the-air, we will make sure there’s a human on the other end of the line to help if something doesn’t work, so we can talk it through and make sure their experience has been one of, I saved a couple days’ dwell time by being in my truck for 30 minutes,” he said.

In addition to elevated levels of support, Mack also attributed an expanded and increasingly efficient product line to its success. Randall said the mDrive and mDrive HD automated manual transmissions have been hugely successful. Last year, they were spec’d in 20% of Mack Granites (37% this year, to date), 60% of Mack Pinnacle axle forward, and 80% of Mack Pinnacle axle back models.

“The mDrive has been a game changer for us,” added John Walsh, vice-president, global marketing and brand management with Mack Trucks. “It’s great in terms of performance and the fuel efficiency it’s been able to deliver. The other thing is, the broadening of the driver pool. We hear from customers all the time, ‘We’d buy more trucks from you if we had more drivers.’ The mDrive expands that pool. The penetration on the highway side is approaching 90% right now.”

The Mack LR cabover engine refuse truck is also performing well, Randall added, especially in Canada where it owns 75% of that segment.

Tim Wrinkle, construction product manager, said Mack has also been successful convincing construction customers that today’s 13-liter engines can deliver all the torque and horsepower required to do a job that fleets traditionally thought could only be achieved by a 15-liter.

The 13L MP8 provides up to 505 hp and 1,860 lb.-ft. of torque, comparing favorably to one 15L on the market that offers up to 505 hp and 1,850 lb.-ft., and rivaling another that comes in at up to 605 hp and 2,050 lb.-ft.

“The 13-liter MP8 is able to deliver big block power and durability,” Wrinkle said.

The durability comes from design attributes that include: a high-strength cast iron block, with bed plate for additional stiffness; 14-bolt flywheel-to-crank mounting (vs 12); more robust connecting rods, with greater bearing surface area compared to competitive 15Ls; and shorter piston travel, which results in less wear and friction on components.

The wide-ranging discussion with Mack executives also touched on hot topics such as autonomous vehicles and alternative fuels. Slagle said Mack is keeping a close eye on the so-called “disrupters,” but doesn’t think autonomous trucks are close to taking over.

“Any manufacturer in this business today has to have their heads up in terms of what is coming in terms of autonomous driving and different drivelines being kicked around and touted by some of the disrupters,” Slagle said. “Autonomous driving, I think it’s pretty clear we’re going to see various ventures into that on the automotive side. On the trucking side, I think the bigger you get, the more complex that will be.”

Slagle said Mack will leverage whatever parent company Volvo Group develops, but added, “It’s something you have to approach very carefully if you have safety as one of your core values. At the right time, with the right partners, and with the right internal innovation, we certainly feel we can be competitive and on top of whatever is going on, maybe even leading it.”

Walsh added autonomous trucks will likely first find a home in isolated environments, such as quarries and other job sites where interactions with other vehicles and humans are limited.

As for all the buzz about electric trucks and other alternative fuels, Slagle said don’t rule out diesel yet.

“The truth is, diesel remains a very formidable fuel,” he said. “It’s powerful. It’s now clean. It has an image problem, but with 3.5 million diesel vehicles out there and 60,000 diesel stations, it’s going to be with us for a while.”

Mack still sees promise in dimethyl ether (DME), which burns clean and eliminates the need for a diesel particulate filter.

“We think, some day, it will have its day,” Slagle said of DME.


James Menzies

James Menzies

James Menzies is editor of Truck News and Truck West magazines. He has been covering the Canadian trucking industry for more than 15 years and holds a CDL. Reach him at james@newcom.ca or follow him on Twitter at @JamesMenzies.
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1 Comment » for Steady vocational market driving Mack’s growth
  1. Dimethyl ether will make a tremendous impact in this market. DPF filter regeneration in stop and go driving is a problem. DME eliminates the DPF. Moreover, fuel depots will never worry about a spill or diesel sludge. Unlike any electric option, fueling turnaround will be as good or better than traditional diesel.

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