Forbes.com

Navigating the New Rules of the Road in Europe's Truck Market

European truck makers must focus on taking and holding market share through several clear imperatives.

著者：Jörg Gnamm and Johan Lundgren

First published on 3月 03, 2017
min read


This article originally appeared on Forbes.com. Europe’s truck industry remains a critical part of the global market, but the rules of the road are changing for truck makers. Brand, which was once an important proxy for quality among buyers, has become less important as Europe’s truck makers have narrowed the gap on performance. Increasingly, customers see performance as table stakes. So how can truck makers differentiate themselves in Europe’s demanding commercial truck market? To help European truck makers understand this core market better, Bain surveyed more than 600 truck customers from the 10 largest countries to gauge how well truck manufacturers meet customer needs, and where they excel or disappoint. This is the latest in a series of surveys we have conducted over the past 25 years. This year’s survey focused on customer loyalty, key purchasing criteria and digital services across three dimensions: country, ﬂeet size and truck application (for example, long haul or distribution). Our survey generated three main insights. On average, Europe’s seven truck manufacturers (DAF, Iveco, MAN, Mercedes-Benz, Renault, Scania and Volvo) are improving their abilities to meet customers’ needs and have increased their customer loyalty scores. Customers with larger fleets are typically more demanding, and their loyalty scores were slightly lower. A truck maker’s response to poor reliability was particularly important. When the truck maker or the service network responded quickly and supportively, loyalty went up; poor service in the face of a breakdown damaged loyalty scores significantly. Hard factors of ownership such as new sales price, fuel consumption and performance, which we called “value for money” in our survey, remain most important, reﬂecting the fact that a truck is an investment good. Total cost of ownership (TCO) accounted for a full third of importance, followed by new sales price with 22%, and truck performance with 17%. The customer’s relationship with the truck maker and service network are also becoming more important. Digital features are becoming an important differentiator, especially those services that can reduce costs or increase uptime for ﬂeet owners and operators, such as driver monitoring, ﬂeet management, safety and security, and predictive maintenance. One in four customers are willing to spend extra for digital services, with the large ﬂeets leading the way. And customers already see some truck makers out in front, with more than a third rating the digital services of two manufacturers better than the rest of the pack—which suggests the others need to get moving. With these findings in mind, executives at Europe’s truck makers have several clear imperatives in order to position them for future success. Understand customer needs. Truck makers need a thorough and detailed understanding of customer needs to consistently deliver customer value. Established methods of customer analysis from other industries such as retail can help executives understand and manage the differences across segments. Master the table stakes. Manufacturers must deliver truck reliability, service, TCO and performance with consistently high standards. Given that TCO remains the most important purchase criterion, even premium manufacturers with higher new sales prices can differentiate by demonstrating long-term value. Original equipment manufacturers (OEMs) will increasingly bundle their offers in ways that provide a strong business case, focusing on TCO, uptime and a basket of features, including digital services. Focus on customer relationship, after-sales and service delivery. Relationship and service remain key purchasing criteria for customers. Enhancing the customer experience through systematic investments will help OEMs improve sales of parts and service. Establish smart digital service offers. Focus on services that improve TCO and uptime to justify customers’ investment and help them see better returns. OEMs will need to redeﬁne their operating models to successfully deliver digital services, potentially unlocking signiﬁcant new proﬁts and even creating new lines of business. However, most truck makers face a real challenge in becoming digital champions. Digital requires new skills that differ from those that built the truck industry, including a shift of emphasis from hardware to software, and from products to solutions. Most OEMs will need to deﬁne a new digital operating model—including structure, governance and behaviors—to deliver on the digital opportunities that will be critical to success. Even as the truck market becomes more global, Europe will remain key to securing stable proﬁts across economic cycles. Truck sales are growing rapidly in developing economies, but parts and services—which are essential to create sustainable proﬁts—remain a small part of the market there. European truck makers must continue to focus on taking and holding market share in their home market if they are to remain competitive globally. Jörg Gnamm is a partner with Bain & Company in Munich. Johan Lundgren is a partner in Bain’s Stockholm ofﬁce.

This article originally appeared on Forbes.com.

Europe’s truck industry remains a critical part of the global market, but the rules of the road are changing for truck makers. Brand, which was once an important proxy for quality among buyers, has become less important as Europe’s truck makers have narrowed the gap on performance. Increasingly, customers see performance as table stakes. So how can truck makers differentiate themselves in Europe’s demanding commercial truck market?

To help European truck makers understand this core market better, Bain surveyed more than 600 truck customers from the 10 largest countries to gauge how well truck manufacturers meet customer needs, and where they excel or disappoint. This is the latest in a series of surveys we have conducted over the past 25 years. This year’s survey focused on customer loyalty, key purchasing criteria and digital services across three dimensions: country, ﬂeet size and truck application (for example, long haul or distribution).

Our survey generated three main insights.

On average, Europe’s seven truck manufacturers (DAF, Iveco, MAN, Mercedes-Benz, Renault, Scania and Volvo) are improving their abilities to meet customers’ needs and have increased their customer loyalty scores. Customers with larger fleets are typically more demanding, and their loyalty scores were slightly lower. A truck maker’s response to poor reliability was particularly important. When the truck maker or the service network responded quickly and supportively, loyalty went up; poor service in the face of a breakdown damaged loyalty scores significantly.

Hard factors of ownership such as new sales price, fuel consumption and performance, which we called “value for money” in our survey, remain most important, reﬂecting the fact that a truck is an investment good. Total cost of ownership (TCO) accounted for a full third of importance, followed by new sales price with 22%, and truck performance with 17%. The customer’s relationship with the truck maker and service network are also becoming more important.
Digital features are becoming an important differentiator, especially those services that can reduce costs or increase uptime for ﬂeet owners and operators, such as driver monitoring, ﬂeet management, safety and security, and predictive maintenance. One in four customers are willing to spend extra for digital services, with the large ﬂeets leading the way. And customers already see some truck makers out in front, with more than a third rating the digital services of two manufacturers better than the rest of the pack—which suggests the others need to get moving.

With these findings in mind, executives at Europe’s truck makers have several clear imperatives in order to position them for future success.

Understand customer needs. Truck makers need a thorough and detailed understanding of customer needs to consistently deliver customer value. Established methods of customer analysis from other industries such as retail can help executives understand and manage the differences across segments.
Master the table stakes. Manufacturers must deliver truck reliability, service, TCO and performance with consistently high standards. Given that TCO remains the most important purchase criterion, even premium manufacturers with higher new sales prices can differentiate by demonstrating long-term value. Original equipment manufacturers (OEMs) will increasingly bundle their offers in ways that provide a strong business case, focusing on TCO, uptime and a basket of features, including digital services.
Focus on customer relationship, after-sales and service delivery. Relationship and service remain key purchasing criteria for customers. Enhancing the customer experience through systematic investments will help OEMs improve sales of parts and service.
Establish smart digital service offers. Focus on services that improve TCO and uptime to justify customers’ investment and help them see better returns. OEMs will need to redeﬁne their operating models to successfully deliver digital services, potentially unlocking signiﬁcant new proﬁts and even creating new lines of business. However, most truck makers face a real challenge in becoming digital champions. Digital requires new skills that differ from those that built the truck industry, including a shift of emphasis from hardware to software, and from products to solutions. Most OEMs will need to deﬁne a new digital operating model—including structure, governance and behaviors—to deliver on the digital opportunities that will be critical to success.

Even as the truck market becomes more global, Europe will remain key to securing stable proﬁts across economic cycles. Truck sales are growing rapidly in developing economies, but parts and services—which are essential to create sustainable proﬁts—remain a small part of the market there. European truck makers must continue to focus on taking and holding market share in their home market if they are to remain competitive globally.

Jörg Gnamm is a partner with Bain & Company in Munich. Johan Lundgren is a partner in Bain’s Stockholm ofﬁce.