2009 Global Commercial Vehicle Report I Terms of Use

20092009 GlobalGlobal CommercialCommercial VehicleVehicle ReportReport Includes: Heavy Duty Maintenance in the USA Survey Heavy Duty Distributor Survey

The 2009 Global Commercial Vehicle Report i Terms of Use

Disclaimer. All content provided in this Publication is based upon information which we believe to be reliable and should be understood to be general industry information only. It is not intended to be taken as advice with respect to any individual situation and cannot be relied upon as such.

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Restrictions on Use. You may not use the Publication for any illegal purpose or in any manner inconsistent with these terms of use. You may use the Publication solely for your personal use and benefit or that of your organization, and not for resale or other transfer to, or use by or for the benefit of, any other person or entity. You may not use, transfer, distribute or dispose of any information contained in the Publication in any manner that could compete with the business of HDMA/MEMA. This Publication has been developed, compiled, prepared, revised, selected and arranged by HDMA/MEMA and others (including certain other information sources) through the application of methods and standards of judgment developed and applied through the expenditure of substantial time, effort and money and constitutes valuable intellectual property and trade secrets of HDMA/MEMA and such others. The proprietary rights of HDMA/MEMA and all others having rights in the Publication must be protected.

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ii The 2009 Global CommerHDMAcial Vehicle Report January 2009

Fellow Heavy Duty Industry Professional, We are certainly in the midst of challenging economic times. The US and global commercial vehicle markets are experiencing tremendous change due to new environmental policies and regulations and a global slowing of commerce and trade. I am proud to introduce our new 2009 Global Commercial Vehicle Report which also includes Heavy Duty Truck Maintenance in the USA, as well as the 2008 HDMA Distributor Survey. As the commercial vehicle supplier industry becomes more and more international in scope and growth, we felt it necessary to enhance our market research projects for our members and to expand our research from Heavy Duty Truck Maintenance in the USA and transition it into a global report.

Other expanded features of the 2009 Global Commercial Vehicle Report include: l Special Sections on emerging markets that include China, India, Russia and Brazil l Global highway transportation reports l Truck exporting Additional print or CD-ROM copies of the 2009 Global Commercial Vehicle Report are available and can be ordered online at www.hdma.org. The association member price is $99.95, and the non-member price is $695.00. Volume discounts are available. Please call 919.406.8847 for more details. High resolution artwork in the 2009 Global Commercial Vehicle Report is available to HDMA members free of charge. Non-members who wish to obtain any of the artwork within the report can contact an HDMA representative for pricing. Your membership in HDMA is now more important than ever. For the past 25 years, HDMA has been the only non-profit manufacturers association that exclusively represents the strategic interests of the North American commercial vehicle supplier community. With the full support and backing of the 105 year old Motor and Equipment Manufacturers Association (MEMA), HDMA provides its members with a range of services that include highly effective government representation in Washington, to the WTO and on the EU WP29. We offer a range of member services, including market research and economic reports, industry representation, timely information and news services, availability of the MEMA presiden t ’s le tt er Financial Services Group, peer councils and forums, and premier industry events and conferences. During these current times, membership in HDMA and the other two MEMA market segment associations, AASA and OESA, carry an even higher value to our members. With a full range of services that help to stretch your bud- gets, members save on DC lobbying expense, retainers on economic reporting and primary market research, registra- tion costs for events, shows and conferences and many other services. Please visit hdaw.org for additional HDMA membership benefit information. If we can be of any assistance, please feel free to contact us. We look forward to serving your membership needs today and in the future. Kind regards, Property of Property of Timothy R. Kraus President, Chief Operating Officer The Heavy Duty Manufacturers Association

HDMA The 2009HDMA Global Commercial Vehicle Report 1 Table of Contents

1 Executive Summary...... 9 Heavy Duty Universe Estimates...... 10 Economic Situation...... 12 2 Trucking Operators Survey...... 14 3 Heavy Duty Distributor Survey...... 27 4 Operating Factors...... 30 5 Trade ...... 36 6 US Motor Vehicle Industry Data...... 50 7 North American Industry...... 54 A Transportation...... 54 B Truck Sales...... 58 C Vehicle Population...... 59 Table of c on t en s D Commercial Trailers...... 61 E Canada...... 63 F Mexico...... 65 8 Global Section...... 68 A Highway Infrastructure...... 68 B Highway Freight Movement...... 74 C Global Commercial Vehicle Population...... 75 D Commercial Vehicle Sales...... 79 E World Commercial Vehicle Production and Assembly...... 84 9 China Special Section...... 94 10 Russia Special Section...... 97 11 Brazil Special Section...... 99 12 India Special Section...... 102 13 Methodologies...... 108 14 Acknowledgements...... 109 15 AppendixProperty...... of 110 16 HDMA Roster...... 118

2 The 2009 Global CommerHDMAcial Vehicle Report Heavy Duty Manufacturers Association

HDMA Membership Benefits l Industry experts providing market information business updates to the membership HDMA has grown from 41 inaugural members to 175 in 2008 and is poised for continued growth. HDMA members represent over Industry change agent - HDMA is a recognized change agent, hav- $150 billion in yearly revenue, over 150,000 employees in all ing played an instrumental role in many industry initiatives, such 50 states, and 55% of the US market for commercial vehicle parts. as the formation of HDAW, influencing anti-counterfeiting law, the This business segment is a substantial portion of US manufacturing, rewrite of FMVSS 121, and many other industry initiatives. representing significant jobs and employment, personal income and tax base generation. HDMA members are companies with manu- HDMA member and association executives regularly contribute facturing facilities mainly located in North America, and include quotes and guest columns for publications and the media. HDMA both large and small, publicly traded corporations and privately held executives are available to present and speak at various HD industry firms. conferences and events. HDMA’s membership services are focused on NAFTA-based suppliers to the global commercial-vehicle truck, bus, trailer and engine Industry Peer Business Councils builder and replacement parts market segments. A growing number Heavy Duty Brake Manufacturers Council (HDBMC) is com- of HDMA members are becoming multi-national and in many prised of senior technical executives of member companies in the cases, global in their approach to business. HDMA is striving to heavy duty brake components and braking systems market. Mem-

offer value to a changing market, and has and will continue to add bership in HDBMC is restricted to just those companies directly t ion benefits and services to reflect the needs of the members. involved in OEM design and manufacturing of brake components and systems. Memberships are for the individual member company HDMA Membership Demographics and are limited to a primary representative and a back-up delegate for council proceedings. This important council works toward the l 175 NAFTA-BASED Supplier Members standardization of design envelopes for components, safety-related l Estimated 150,000 employees in 50 states design issues, interaction with government regulatory agencies, as l HDMA members comprise a large percentage (55%+) of the well as additional related items in common with SAE, TMC and US market for HD commercial vehicle components TMA such as numbering systems and recommended practices. This l Publicly traded companies include: Accuride, ArvinMeritor, council has a very strong interface with the MEMA Government Dana, Eaton, Federal Mogul, etc. Affairs office in Washington, D.C. and contributes frequently to l Privately held firms include: Bendix, Bosch, MGM Brake, offer industry insight in the instances of potential governmental Haldex, Phillips Industries, Pressure Systems, International, regulations for this industry. All meetings of HDBMC are closed to etc. non-council members. l Stable and growing base of members. l Active and involved long term members Heavy Duty Business Forum (HDBF) is a group founded in 1978, l 16 member board of directors consisting of industry leading and was the catalyst of the formation of Heavy Duty Manufacturers executives. Association. The members are top executives of HDMA member companies and meet twice annually to discuss industry issues and Market Research challenges. Membership in HDBF is limited to 50 executives in the HD market, and individuals must be nominated for membership l Heavy Duty Maintenance in the USA – unique to the industry by three current members and elected by a simple majority of the Business Forum members. The Forum charter mandates the HDBF l HDMA Quarterly Supplier Barometer functions only as a platform for discussion, with no action taken on l Monthly Market Analysis newsletter includes Economic & ctu rers asso c ia v y d ut man u fa Industry information behalf of its members. Meetings are closed to non-members and anti-trust counsel attends all meetings and activities. There is cur- l Periodic and topical member surveys covering raw materials, rently a waiting list for membership in this council. healthcare, etc. hea l Timely special reports Heavy Duty Marketing and Sales Forum (HDMSF) is a newly l Over $200,000 is spent annually on primary market research formed council comprised of sales and marketing executives of member companies with a primary emphasis on the OEM market. This Up-to-Date Industry Information council is designed to drive the direction and content of HDMA l Weekly Diesel Download electronic newsletter market research publications as well as to discuss industry trends and l Weekly International Diesel Download electronic newsletter forecasts. HDMSF holds two meetings annually, and members par- l Daily MEMA Industry News electronic newsletter ticipate in conference calls and webcasts as necessary to determine l Weekly MEMA TopLineNews electronic newsletter various survey details and results. Meetings of HDMSF are closed to Property of l Bi-weeklyProperty Washington Insider newsletter non-councilof members. l Monthly Personnel Insight newsletter l Real time Member-only web access with valuable The Intelligent Vehicle Electronics Technology Council, or 4TEC information and links to industry indicators dashboard is also a newly formed technical council comprised of engineering l Special reports on the heavy duty market by members of the executives from HDMA member companies. This council focuses financial community on the needs of heavy duty electrical and electronics manufacturers

HDMA The 2009HDMA Global Commercial Vehicle Report 3 regarding government representation and industry testing standards the individual status of a specific customer or discuss industry condi- design compatibility issues. The main goal of 4TEC is to provide in- tions and trends. This information, along with the credit executive’s put to the various regulatory agencies regarding rule-making and to independent investigation, enables the company to make a more collectively serve as a technical resource to each other and govern- informed, educated credit decision. Trade clearances, credit reports ment agencies when required. and important news bulletins are provided to our subscribers, which range in size from the giants of the industry to the smaller manufac- Transportation Safety Equipment Institute (TSEI) is an inde- turers serving niche markets. This service is available for one low pendent association under HDMA and serves the needs of manu- annual fee and is accessible by traditional methods and through the facturers of OEM and aftermarket motor-vehicle safety devices and internet. associated equipment. It provides government representation and market research services, monitors proposed and enacted legislation Trade Shows and Special Events and regulations, and serves as a technical forum to resolve industry problems. This council also has extensive interaction with the HDMA is an owner and organizer of Heavy Duty Aftermarket MEMA Government Affairs Office and meets as often as necessary, Week, the premier heavy duty business conference for executives or when potential legislation requires input by the council. TSEI from the aftermarket supplier and distributor business segments. meetings are closed to non-members. Held over 3 day period, the conference focuses on a planned education track, one-on-one meetings between suppliers and distributors, The MEMA Human Resources Council (HRC) provides a forum the HDAW Product Expo and many opportunities to build industry hea for senior human resource executives to identify and address strate- relationships at breakfasts, breaks, lunches and private receptions. gic issues, share best practices, recommend solutions and promote The event culminates in an award luncheon with recognition of the welfare of the supplier industry by supporting the effective im- excellence for distributors and suppliers within the heavy duty v y d ut man u fa ctu rers asso c ia plementation of human resources practices. Eligibility is determined industry. Considered by the entire industry as the main heavy duty by the council board of governors based on the perceived ability of aftermarket event to attend, HDAW is the only forum that brings prospective members to participate and contribute in council discus- the heavy duty distributor and supplier open and frank business sions and activities. As a peer group comprised of senior human discussion. HDMA membership benefit includes a 35% exhibitor resources executives, industry and professional experience are im- discount for members portant determinants used by the board of governors in considering potential members. The council meets quarterly at member-selected Heavy Duty Dialogue is a yearly conference positioned as a member times and locations. Meetings follow an agenda and feature a round and prospective member meeting. Content is developed to provide table format to discuss previously identified issues. Council members cutting edge information on industry and market trends, forecasts, discuss topics and exchange opinions and ideas resulting in either a presentations on strategy by industry leading executives and other resolution of the issue or a plan for investigation and analysis. experts. HD Dialogue is considered to be the premier business conference of the year in the commercial vehicle supplier industry. The MEMA Brand Protection Council (BPC) is a membership peer- exceptional content of the program is provided through the guid- council of executives responsible for brand and intellectual property ance of the HDMA board of directors and its executive committee, rights protection within their company. The Council focuses on best who plan the content for the program. The program begins with a practices, solutions and information on counterfeit parts, black- and 7 AM breakfast and concludes with an all-industry reception, begin- gray-marketed products and intellectual property issues. ning at 5:30 PM; luncheon and breaks are included.

MEMA Information Services Council (MIS Council) is a peer HDMA Annual Breakfast & Briefing at Mid-American Truck- group of individuals from MEMA member companies who are ing Show is a highly popular event that attracts a diverse audience responsible for their companies’ IS operations and serves as a forum of supplier, media and truck manufacturer executives and other for industry interaction, education and idea exchange. personnel and is considered a “must-do” event at the Mid-American Trucking Show. Membership in HDMA allows members preferred MEMA Government Affairs Council is an HDMA board appoint- seating at this event which attracts over 700 attendees yearly. t ion ed group of top executives that meet during HDMA board meetings and via conference calls. The group meets regularly to discuss The MEMA Legislative Summit is an annual event open for potential and current priorities related to the heavy duty industry HDMA members, with typically over 100 industry leaders partici- regulatory issue focus of the MEMA Government Affairs office. pating in this very popular member benefit. The program includes a keynote speaker who represents the interests of members within gov- MEMA Regulatory Affairs Council is an HDMA board appointed ernment, a panel discussion of government relations best practices, group of top executives that meet during HDMA board meetings as well as the ever popular Congressional reception and supplier and via conference calls. The group meets regularly to discuss fair, which typically has over 250 Congressmen, Senators and staff potential and current priorities related to the heavy duty industry attending. The culmination of the event is pre-set appointments regulatory issue focus of the MEMA Regulatory Affairs office. in both senate and congress offices, promoting industry issues such as patent reform, counterfeiting and trade issues, tax incentives for MEMA Financial Services Group (MFSG) provides member credit heavy duty vehicles and continued funding for advanced technology and financial executivesProperty with accurate, timely information relating programs.of Invitations are extended during these visits for the rep- to a customer’s trade payments and a detailed analysis of their opera- resentatives to tour the companies’ manufacturing facilities, which tions. MFSG has a staff of seasoned analysts who can communicate continue the opportunity to build relationships and increase the exposure of our member companies to their elected leaders.

4 The 2009 Global CommerHDMAcial Vehicle Report Special savings on services, research, l Access to StateLink – State legislative monitoring web site, trade shows and events subscription value of over $30,000 (free access to HDMA members) l 35% discounts on exhibit booth space at Heavy Duty l Utilization of the MEMA DC office typically saves HDMA Aftermarket Week member firms $30-100K on average per year in lobby firm l 20% discount on MEMA Financial Services credit reporting fees and expenses program l 15-20% discount on exhibit space at Automechanika shows Government Issues covered by HDMA include: worldwide l Energy Policy (fuel efficiency/climate change/clean diesel l Reduced divisional membership rates for the Automotive engine standards) Aftermarket Suppliers Association and Original Equipment u Suppliers role in energy policy Suppliers Association u Role of technologies to improve fuel economy and l Member discount on MEMA Financial Services Group greenhouse gas emission u Need for one regulatory framework Representation by MEMA in Washington, DC l Highway Bill u Heavy Duty Tax Incentives l Only trade association office that exclusively represents the u Aftermarket State Inspections suppliers interests in Washington u Other vehicle safety initiatives l Staffed and led by industry veterans from the heavy duty industry with a staff of highly qualified industry legislative l Coalitions – of key importance to suppliers and regulatory experts with experience in policy making u Research and development tax credit t ion l Government Affairs Committee (GAC) – a group of 35 l Level Playing field in Global Environment member companies that work to define our industry u Patent reform focus and is open to all HDMA members u Brand protection/Anti-Counterfeiting l Legislation monitoring and advocacy u WP29 Representation l Regulatory watchdog and advocacy l Heavy Duty industry voice/representation on critical and/or l Stopping Distance Rule for Heavy Duty Trucks sensitive issues l Commercial Vehicle Safety Technology l Annual Legislative Summit- Meet face-to-face with your l Heavy Duty Diesel Rule Senator and Congressman in their Washington offices l Right to Repair during our annual Summit and discuss the important issues l CSA 2010 facing your company & business environment Heavy Duty Manufacturers Association

Board of Governors – Officers Board of Governors Dennis Michels – Chairman President, CEO Vicky Black Edward Oeltjen Link Manufacturing President, CEO President Fabory North America Consolidated Metco Terrence Keating – 1st Vice Chairman Chairman Pat Cavanaugh Ron Parker Accuride President President, CEO, Chairman Jack Shaffer – 2nd Vice Chairman Williams Controls MGM Brakes ctu rers asso c ia v y d ut man u fa President, COO Bergstrom John Coll Bob Phillips hea Vice President, Sales, Vehicle Solutions President, CEO Joseph McAleese – Eaton Corporation Phillips Industries Immediate Past Chairman President, CEO Pedro Ferro Joseph Plomin Bendix CVS President Vice President, Truck Group Timothy Kraus Marmon CV Undercarriage ArvinMeritor President, COO Heavy Duty Manufacturers Association Tim Meyer Gary Smalley Vice President, General Manager President, CEO Property of Robert McKennaPropertyAlcoa CV Wheel of Dayton Parts LLC President, CEO Motor & Equipment Manufacturers Association Tim Musgrave Jim Wojciehowski Wendy Earp President, CEO Vice President, General Manager of Vice President, Secretary, and CFO Pressure Systems International Marketing, Sales and Service Motor & Equipment Manufacturers Association Dana Commercial Vehicle Products Group

HDMA The 2009HDMA Global Commercial Vehicle Report 5 HDMA Contact Information MEMA Financial Services Group Timothy Kraus Dan Pike President, Chief Operating Officer MEMA Financial Services Group (MFSG) 919-406-8835 919-406-8821 [email protected] [email protected]

Robert McKenna HDMA Event Contacts President, CEO Heavy Duty Dialogue Motor & Equipment Manufacturers Association Jennifer Hjalmquist 919-406-8801 919-406-8847 [email protected] [email protected]

Mark Iasiello Heavy Duty Aftermarket Week Vice President, Member Development Jennifer Hjalmquist 919-406-8823 919-406-8847 [email protected] [email protected]

Jennifer Hjalmquist Breakfast & Briefing hea Director, Marketing & Member Services Jennifer Hjalmquist 919-406-8847 919-406-8847 [email protected] v y d ut man u fa ctu rers asso c ia [email protected]

Wayne Fulford Washington Legislative Summit Member Services Representative Ann McCullough 919-406-8814 202-312-9242 [email protected] [email protected]

Tom Hibbard PAACE Automechanika Mexico Creative Director Anthony Cardez 919-406-8815 919-406-8810 [email protected] [email protected]

Zoltan Borsodi Expo Transporte Web Support Manager Eugenio Carillio 919-406-8848 52-55-5545-4488, ext. 108 [email protected] [email protected]

HDMA Government Affairs AASA Vision Conference Ann Wilson Chris Gardner Senior Vice President, Government Affairs 919.406.8830 202-312-9246 [email protected] [email protected] Aftermarket eForum Leigh Marino Chris Gardner t ion Director, Federal and State Regulatory Issues 919.406.8830 202-312-9249 [email protected] [email protected] Automotive Aftermarket Products Expo (AAPEX) Nelson Garcia Chris Gardner Director, Federal and State Policy 919.406.8830 202-312-9243 [email protected] [email protected] HDMA Council Contacts HDMA Research Heavy Duty Business Forum Frank Hampshire Tim Kraus Senior Director, Research 919-406-8835 919-406-8812 Property [email protected] [email protected] Heavy Duty Brake Manufacturers Council Richard Anderson Mark Iasiello Senior Research Analyst 919-406-8823 919-406-8875 [email protected] [email protected]

6 The 2009 Global CommerHDMAcial Vehicle Report Heavy Duty Marketing and Sales Forum HDMA Services Mark Iasiello Collection Services 919-406-8823 Central Mercantile Collection Service [email protected] A licensed agency of MFSG 800-223-6259 IVTEC Fax: 810-229-5540 Mark Iasiello 919-406-8823 Executive [email protected] Timothy Kraus 919-406-8835 Brand Protection Council [email protected] Jack Cameron 919-406-8856 Filter Recycling Hotline & Database [email protected] Jeremy Denton 919-406-8846 China Aftermarket Forum (CAF) [email protected] Chris Gardner 919.406.8830 International Trade Shows [email protected] Anthony Cardez 919-406-8810 Credit Reporting Groups [email protected]

Dan Pike t ion 919-406-8821 Media and Public Relations [email protected] Jennifer Hjalmquist 919-406-8847 Filter Manufacturers Council [email protected] Jeremy Denton 919-406-8846 Membership [email protected] Mark Iasiello 919-406-8823 Human Resources Council (HRC) [email protected] Jo Anne Farr 919-406-8852 Market Research [email protected] Frank Hampshire 919-406-8812 MEMA Financial Services Group [email protected] Dan Pike 919-406-8821 Publication Orders [email protected] Wayne Fulford 919-406-8814 MEMA Information Services Council (MIS Council) [email protected] Chris Gardner 919.406.8830 IT Related Issues [email protected] Chris Gardner 919.406.8830 Motor Vehicle Lighting Council [email protected] ctu rers asso c ia v y d ut man u fa Jeremy Denton 919-406-8846 hea [email protected]

Overseas Automotive Council (OAC) Anthony Cardez 919-406-8810 [email protected]

Transportation Safety Equipment Institute (TSEI) Jeremy Denton Property of 919-406-8846 Property of [email protected]

HDMA The 2009HDMA Global Commercial Vehicle Report 7 The 2009 Global Commercial Vehicle Report

Introduction The 2009 edition of The Global Commercial Vehicle Report was designed to be a reliable tool for the analysis of heavy duty truck user The Heavy Duty Manufacturers Association is proud to present this repair factors, heavy duty truck use, changes in buying patterns, and biannual report to our members. It reflects the long term commit- service work performance. New sections include a global transporta- ment to the aftermarket series, while it continues to grow in scope to tion overview, special sections on China, Russia, India and Brazil, include information beyond previous editions including heavy duty the world commercial vehicle populations and an expanded section original equipment. We have again expanded the publication to on operating factors such as fuel efficiency and environmental im- include more economic and international information while main- pact. As in the previous reports, this volume contains estimates of taining the continuity of the fleet maintenance section of the report. the total heavy duty truck universe and market segments for heavy Additions to the report that were introduced in the last edition are duty trucks with a gross vehicle weight (GVW) greater than 19,501 again included; specifically, the survey of heavy duty distributors in pounds (Classes 6,7, and 8). the U.S. that explores aspects of the supply chain relationships within the heavy duty aftermarket, international trade in motor vehicle The Heavy Duty Manufacturers Association is the heavy duty parts and exports of used trucks. The Global Commercial Vehicle

The 2009 Global Commer c ial Vehi le R epor market segment association within the Motor & Equipment Manu- Report includes our previous study, Heavy Duty Truck Maintenance facturers Association. Funding for the publication of this report is in the USA, first published in 1978 and is the longest running study provided by the Educational & Research Foundation of MEMA, Inc. of the heavy duty aftermarket in the industry. t

Property of

8 The 2009 Global CommerHDMAcial Vehicle Report Executive Summary

The core of this report is the primary research examining truck maintenance practices in the United States. This study represents Businesses Planning to Buy or Lease New Trucks all heavy-duty class 6 through 8 trucks that are operated and main- Average tained by private sector businesses in the United States that were Number built for on highway use, including those used off-road or otherwise Percent of Trucks not registered for use on the road. Consequently, the total number of trucks and truck tractors covered by this study is greater than the Private Fleets 12.9% 103.2 population considered when the basis is vehicle registrations. The Commercial Fleets 7.1% 44.2 trucks represented in this study will generate annual maintenance Owner/operators 2.9% 7.5 costs totaling approximately $48.9 billion in 2008. This study excludes busses, equipment (stationary and mobile), and all government vehicles. Consequently, actual heavy-duty maintenance expenditures in the U.S. will easily exceed this figure. Commercial Vehicles in Operation These businesses represent the majority of the heavy-duty market for maintenance products, and almost all of the domestic market for new vehicles. EPA regulations on diesel fuel and emissions produced by new trucks have confounded the timing of new truck purchases for most of this decade. By pulling forward the sales of vehicles,that under normal conditions would have been purchased at a later time, the cycle of purchase and replacement has been completely disrupted. With additional regulations around the corner, fuel price and availability problems, an economic turndown with global ramifications and the almost total uncertainty surrounding the future of our financial markets, trucking and transportation in the U.S. will be unsettled well into the next decade.

Businesses with Trucks on Order

Source: R. L. Polk & Co.

Commercial Vehicles in Operation exe cut i v e s u mmary

Jun-07 Jun-08 Change

Class 5 593 621 4.7% Class 6 1,554 1,562 0.5% Class 7 1,628 1,643 0.9% Class 8 3,581 3,608 0.8% Total Cl. 6-8 6,763 6,813 0.7% Property of Property of

HDMA The 2009HDMA Global Commercial Vehicle Report 9 Heavy Duty Universe Estimates

The determination of the overall size and structure of the market is Construction the starting point for any marketing plan or situation analysis. This is no different for the heavy duty aftermarket, and the estimates in Heavy duty trucks in this segment are generally operated on public this section of the report serve as a framework for using the results in roadways, but work in harsh environments over rough terrain as the planning process of HDMA member companies. The descrip- well. The vehicles accumulate fewer annual miles than highway tive data in the report can be used to explore the service practices fleets, but maintenance is intensive due to the harsh conditions of heavy duty vehicle maintainers. With these estimates a targeted combined with the need to maintain them in a condition acceptable market segment can be examined and benchmarks established. for on-highway use. Percent of Registrations...... 10.9% All estimates are for private sector class 6 through 8 trucks in opera- Average Yearly Miles ...... 81,450 tion and exclude all other vehicles and equipment as explained in Vehicle Population...... 393,272 the methodology section. Total Maintenance (millions)...... $15,343

Agriculture, Forestry, Mining and Oil Production and Distribution Field Operations These are private fleets operated by manufacturers and distribu- Vehicles in this segment are not always registered for on highway tors and are used, and seen, on highways across the country. They use. They are primarily local use trucks and are frequently operated accumulate fewer miles than commercial carriers, and the relatively hea in moderately severe and extremely rugged environments. As a clean operating environment helps them minimize maintenance result, mileage is not the primary determinant of vehicle life. As costs. These trucks are highly visible and identifiable to the public much of their use may be entirely off-road, older vehicles are accept- while on the highway, consequently these fleets are less likely to use v y d ut u ni erse es t ima able and sometimes preferred. Vehicles in this segment are generally older poorly maintained vehicles. operated until they are beyond economical repair. Percent of Registrations...... 23.7% Percent of Registrations...... 11.5% Average Yearly Miles ...... 65,010 Average Yearly Miles ...... 100,395 Vehicle Population...... 855,096 Vehicle Population...... 414,920 Total Maintenance (millions)...... $7,727 Total Maintenance (millions)...... $1,875

Heavy Duty Universe t es

Property of

10 The 2009 Global CommerHDMAcial Vehicle Report Highway Transportation vehicles are unique and visible to the public. Annual mileage, despite the local service of most of these vehicles, is up consider- This segment includes commercial carriers and owner/operators and ably over last year, perhaps due to major winter storms. Their share is the primary mover of goods in the country. Although per-mile of maintenance remains in line with their share of the heavy duty maintenance is much less than any of the other groups, their annual vehicle population. mileage is much higher. Bankruptcies and overall economic conditions have reduced the vehicles, while those vehicles remaining in Percent of Registrations...... 7.6% use are driven more miles. Average Yearly Miles ...... 90,429 Vehicle Population...... 274,208 Percent of Registrations...... 46.3% Total Maintenance (millions)...... $3,323 Average Yearly Miles ...... 106,766 Vehicle Population...... 1,670,504 These industry groups maintain more than 3.6 million Class 6, 7, Total Maintenance (millions)...... $20,635 and 8 trucks at an estimated expense of $48.9 billion for service parts and labor. For the remainder of this document both the com- Other mercial carrier and owner/operator components of the Highway Transportation classification will be separate, while the remaining Within this segment are utility and service industry fleets along groups will be combined to form a single private fleet grouping. with a small group of rental and other business types. Many of these t es

Average Yearly Miles Driven v y d ut u ni erse es t ima hea

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HDMA The 2009HDMA Global Commercial Vehicle Report 11 Economic Situation

The U.S. economy, made weaker by a global slowdown, has been Growth in business investment fell to 4.7 percent in 2007, the low- struggling ever since the housing problems and mortgage crisis hit est growth rate recorded since 2003 when it reached 3.3 percent. home in 2007. However, the fundamentals do not present a dire At the same time, construction of non-residential projects exploded picture of continued contraction and, boosted by the federal stimu- 13.0 percent in 2007, up from a growth rate of 8.4 percent in lus payments, the economy managed to grow at a 3.3 percent annual 2006 and representing the fourth straight year of positive growth. rate last quarter. We should be able to avoid the worst scenarios, However, the effects of a slowing economy are likely delayed in this and rather than hitting a sharp drop-off, the economy will slip into sector as forecasts indicate the possibility of negative growth rates in long period of sluggish growth. Furthermore, having entered into the coming two years. what has become a global slowdown before the rest of the world saw it coming, the U.S. will be in a better position to expand when Escalation of consumer expenditures is also slowing, falling to other countries are just beginning to emerge. The actions of the 2.9 percent in 2007 and 1.3 percent for 2008’s forecast. Growth in government and the results of the Presidential election will have a durable goods purchases increased 0.9 points to 4.7 percent in 2007, greater impact on the economy than in any time in recent history. but as with construction, delayed effects are expected with 2008 and The sources and uses of a bailout that could approach a trillion dol- 2009 projected growth rates of -1.0 and 1.2 percent respectively. lars will create uncertainty and confusion. One potential bright spot is the present sentiment towards energy independence and carbon U.S. exports confirmed another year of strong growth in 2007, reduction could result in investment in new energy technologies, rising 8.1 percent. They are expected to continue to show promis- construction of more and cleaner power generation and the acceler- ing growth over the next two years. At the same time, increases ated development of highly efficient vehicles. With foresight all can in imports fell 4.0 points to 1.9 percent in 2007 and are expected provide growth opportunities for U.S. manufacturers. to slip further in 2008. As a result, the U.S. trade deficit has fallen to $739 billion, and is forecast to continue to do so, reaching $610 Real gross domestic product (GDP) growth in the United States billion in 2009. e c onomi si tu a dipped slightly from 2006 to 2007, falling from 2.9 percent to 2.2 percent. The economic slowdown currently occurring in the The unemployment rate bottomed out at 4.6 percent through 2006 U.S. is forecast to continue into 2009 when real GDP is expected and 2007 after consecutive years of decline since reaching 6.0 to grow by just 1.9 percent. It is anticipated that the economy will percent in 2003. It is forecast to rise to 6 percent in 2008 and even regain some strength late in 2009, but any expansion will be sluggish higher in 2009. at best.

Real* GDP Growth t ion

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Source: World Bank * GDP in 2000 constant dollars F = forecast

12 The 2009 Global CommerHDMAcial Vehicle Report U.S. Major Economic Indicators

2006 2007 2008 2009 A actual Actual forecast Forecast Production (% change) Real GDP (Chain - weighted) 2.9 2.2 1.1 1.9 Final Domestic Demand 2.7 1.8 0.5 1.6 Personal Consumption Expenditures 3.1 2.9 1.3 2.0 Durable goods 3.8 4.7 -1.0 1.2 Nondurable goods 3.6 2.4 0.9 2.1 Services 2.7 2.8 2.0 2.2 Business Investment 6.6 4.7 1.7 0.3 Non-residential construction 8.4 13.0 1.8 -4.7 Equipment and software 5.9 1.3 1.2 1.8 Exports 8.4 8.1 7.0 5.3 Imports 5.9 1.9 0.8 3.4

Financial (average for year) t ion 90 Day T - Bill Rate 4.85 4.47 1.50 1.95 Bank Prime Rate 5.02 5.00 2.04 2.33 Long Bond Yield 4.79 4.63 3.60 3.98

Foreign Trade Current account Balance (billions of dollars) -811 -739 -650 -610 Exchange rate (Yen/US$) 116 118 103 107 Exchange rate (US$/Euro) 1.26 1.37 1.54 1.42

e c onomi si tu a Incomes (billions of dollars) Pre-tax Profits with IVA and CCA 1554 1595* 1552 1551 After-tax Profits with IVA and CCA 1100 1129* 1085 1090

Other Indicators Unemployment Rate (%) 4.6 4.6 6.1 5.9 Motor Vehicle Sales (millions) 16.5 16.1 15.1 15.6 Industrial Production 2.2 1.7 0.5 2.5 Property of Property of

HDMA The HDMA2009 Global Commercial Vehicle Report 13 Trucking Operators Survey

Fleet Composition Number of Vehicles All Fleets In this section, purchasing and maintenance practices for three types of trucking operations are examined. The composition of the fleet and the average size of operations are the primary demographics necessary for understanding the magnitude of scope for maintenance activities.

The number of vehicles varies most significantly between fleet and owner/operators. The average number of class 6, 7, and 8 trucks in all operations in this survey was 168.5 vehicles. The average fleet maintains 243 heavy duty trucks, significantly more than owner/ operators who average 19.6 trucks per business.

Single truck operations accounted for 63% of the owner/operators, while 21% operate 2 or 3 trucks and only 16% operate more than 3 trucks. Operations of the largest owner/operator businesses, those operating 10 or more vehicles, are indistinguishable in terms of maintenance practices from small fleets. t r uc kin g opera Small fleets, those with 25 or fewer vehicles, made up 25% of the combined fleet group, and another 25% of the fleets operate more than 150 vehicles. Small private fleets (10 and fewer vehicles) make Private Fleets up 28% of the fleet sample while 36.2% of the private fleets reported more than 100 trucks. Commercial fleets tend to be quite large with 24.5% operating more than 100 class 6 through 8 trucks and 8.5% of the total were over 500 vehicle fleets t ors s u r v ey Number of Vehicles Owner/Operator

Commercial Carriers

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14 The 2009 Global CommerHDMAcial Vehicle Report Fleet managers have numerous other pieces of motorized equipment We have asked for the average per-mile maintenance expense for that must be maintained in addition to the road vehicles noted the Class-8 trucks that the survey respondents maintain. This is to above. This is the third year we have asked the maintenance survey get a better grasp of the value of the different heavy duty aftermarket respondents to provide estimates of the total number of pieces segments, as well as to provide another useful demographic measure. of motorized equipment they are responsible for maintaining. In Shown graphically below, it is apparent that the owner operator is addition, we have again asked for the total number of heavy duty not able to garner the economies of scale that are available to larger trailers in the fleet. These two variables, depending on your product operations. However, construction fleets report the highest per lines, can shape the way you may target the different fleet types. For mile costs due to their need to maintain road ready vehicles in an example, fleets with trailers are important to manufacturers of tires environment that may be nearly as extreme as some mining opera- and suspension, and all motorized equipment, including stationary tions. Other private fleet types include utility fleets that may have equipment, requires periodic engine maintenance, and fleets with complex external components and generally make shorter trips than high equipment counts would be important to filter or fuel system transportation fleets. Both factors increase their average per-mile manufacturers. maintenance expense.

Total Pieces of Motorized Equipment Maintained t ors s u r v ey

Total Heavy Duty Trailers Maintained t r uc kin g opera

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HDMA The 2009HDMA Global Commercial Vehicle Report 15 Average Per-mile Maintenance Expense t r uc kin g opera t ors s u r v ey

Owner Operator $0.18 Commercial Carrier $0.15 Private Fleet $0.17 Ag., Mining, Forestry, Oil Field. $0.18 Production and Distribution of Goods $0.14 Construction $0.27 Other $0.20

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16 The 2009 Global CommerHDMAcial Vehicle Report Fleet Demographics and Purchase Intent

Recent economic events and changes in EPA regulations have Half of owner/operators and nearly three-fourths of commercial car- directly influenced new vehicle purchases well beyond the changes riers are primarily regional or long haul operations. In addition, the due to normal factors that define the market’s development. Truck majority of these transportation companies are truckload operations. and trailer purchase activity is the force that changes the nature of Private fleets tend to be local or regional operations (94.3%) with the vehicle population as it relates to trucking operations in this a single load source and a set of destinations that are determined by study. Other factors including diesel availability, high fuel prices the company so they are not as likely to characterize themselves as and credit availability have shaped the near term purchase plans of less-than-truckload fleets. Consequently, each fleet type will require the survey respondents participating in this study. different types of trucks with different accessories and power options.

Geographical range of operation Operations With Trucks on Order Owner Operator 2.9% Local Regional Long Haul For Hire Fleet 7.1% Owner-Operators 50.0% 30.0% 20.0% Private Fleet 12.9% For Hire/Common Carrier 27.1% 37.1% 35.7% Private Fleet 61.4% 32.9% 5.7% Agriculture, Mining, Oil-field. Forestry 61.9% 33.3% 4.8% Number of New Trucks on Order Production and Owner Operator 7.5 Distribution of Goods 47.1% 41.2% 11.8% Construction 70.0% 30.0% 0.0% For Hire Fleet 44.2 Utility and All Other 66.7% 25.0% 8.3% Private Fleet 103.2 t ors Su r v ey All Fleet Types Combined 46.2% 33.3% 20.5%

Planned Purchase Trucks in the Next Year Logistical range of operation Owner Operator 3.7% Truckload Less than Truckload For Hire Fleet 10.5% Owner-Operators 85.7% 14.3% Private Fleet 19.5% For Hire/Common Carrier 71.4% 28.6% Private Fleet 77.1% 22.9% Tr uc kin g O pera Agriculture, Mining, Oil-field. Forestry 85.7% 14.3% Number of Trailers Plan to Purchase in Production and Next Year Distribution of Goods 64.7% 35.3% Owner Operator 15.0 Construction 70.0% 30.0% For Hire Fleet 43.4 Utility and All Other 91.7% 8.3% Private Fleet 3.1 All Fleet Types Combined 78.1% 21.9% Property of Property of

HDMA The 2009HDMA Global Commercial Vehicle Report 17 Average Heavy Duty Vehicle Life

Expected changes in the 2010 model year vehicles compound dis- ruption in the long-term trend for heavy duty vehicles precipitated by the changes in the 2007 model year vehicles. This trend, brought about by increasing component durability, has been for heavy duty vehicles to accumulate more miles over the course of their useful Average Vehicle Lifespan in Miles life. The average life of a fleet truck can vary considerably depending on freight movement and the impact that external factors such as the pre-buy. Vehicle life, in total miles, had been trending upwards at an annual rate of more than 25,000 miles a year. However, the influx of new vehicles caused by the pre-buy, and the reduction in the used vehicle population as the value of the dollar accelerates exports of used trucks, has lowered the average life from 1,100,000 miles in 2004, and 809,922 total miles in 2006, to 697,200 miles in 2008.

Current capacity utilization has also impacted vehicle life, and fleets reported an average vehicle life expectancy of 10 years in 2008, up considerably from 8.8 in 2006. Commercial carriers are expecting to keep their trucks an average of 8.9 years, and the private fleets in the

Tr uc kin g O pera survey reported that they intend to replace their trucks on average every 11.1 years. Owner/operators expected to keep their vehicles an average of 9.9 years, much longer than they did in 2002 when the life expectancy was 7.4 years.

Overall, the life expectancy of trucks in the sample was 10.0 years and 697,200 miles per vehicle, while truck utilization in the total combined sample averaged 97,504 miles per vehicle per year. t ors Su r v ey

Average Years of Vehicle Life Average Vehicle Use in Miles per Year

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18 The 2009 Global CommerHDMAcial Vehicle Report Brand Versus Supplier Loyalty

Measuring brand loyalty is generally an important marketing func- As in previous editions, brand preference and vendor loyalty are tion aimed at an attempt to determine the brand equity of a specific examined by assuming those electing to wait are insensitive to product or product line. Here we are attempting to measure the downtime and removing them from consideration. Therefore, “go overall power of brands with respect to the heavy duty aftermarket. elsewhere” is a clear signal of brand importance while a response of In the fleet maintenance survey we asked those responsible for heavy “take another brand” is interpreted as the equivalent of “brand is less duty vehicle maintenance what they do when their desired brand for important than supplier.” a replacement part is not available. Together, brand preference and supplier loyalty primarily compete in the decision process with the Brand loyalty is more likely to be the deciding factor in decision costs associated with equipment downtime. With the known and making than is the supplier when downtime is more important unknown costs associated with an out of service vehicle, both brand because it is associated with quality. Because manufacturers and re- preference and supplier loyalty should, in most cases, take a back tailers tend to have newer fleets than other industries, more vehicles seat to downtime. Those who would elect to “wait for the part” are and components are under warranty, and the fleet manager may feel either very loyal to both brand and supplier, have so much slack that OE branded parts are required. that down time is not a problem, or are not in a position to change brands or suppliers. In this study, fleet managers of construction fleets are the least loyal to brands, perhaps this is directly related to the economic downturn Construction fleets, especially when building is booming, were most that began in the housing industry and has hit construction harder sensitive to down time and most brand loyal. For them, downtime than any other sector. However, even in these difficult times, brand costs can mount up rapidly as downstream tasks are delayed by any is still important to construction fleets with 40% more loyal to brand bottleneck. Owner operators are either more loyal to their supplier, than their supplier. Private fleets associated with the production and or are unable to change suppliers easily. distribution of goods are the most loyal to brand and the remaining fleet types are about evenly split between preference for a particular brand and loyalty to the supplier. When a Desired Part Is Not Available Get It Take The From A Brand Loyalty Next Available Different Wait For Fleet Type Brand Supplier The Part More Loyal More Loyal

Fleet Type To Brand To Supplier t ors Su r v ey Owner-Operators 35.7% 32.9% 31.4% For Hire/Common Carrier 38.6% 35.7% 25.7% Owner/operator 52% 48% Private Fleet 40.0% 38.6% 21.4% For Hire Fleet 52% 48% Agriculture, Mining, Agriculture & Mining 53% 47% Oil-field. Forestry 38.1% 33.3% 28.6% Production & Production and Distribution of Goods 60% 40% Distribution of Goods 52.9% 35.3% 11.8% Construction 40% 60% Construction 30.0% 45.0% 25.0% Other 50% 50%

Utility and All Other 41.7% 41.7% 16.7% Tr uc kin g O pera All Fleet Types Combined 38.1% 26.2% 35.7%

Brand vs. Supplier Loyalty

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HDMA The 2009HDMA Global Commercial Vehicle Report 19 Brand Specification of Replacement Components

A preferred brand is generally perceived as having the highest The importance of quality as a product attribute is obvious, but price quality, and if the brand happens to be somewhat higher priced, the and availability are also part of the decision process. When a truck premium paid can be viewed as providing downtime protection. The maintainer specifies a particular brand the products quality may have influence of brands in the heavy duty aftermarket is not the same as been the primary motivating force, but price, warranty and avail- it is in the light duty aftermarket. A single negative (costly) experi- ability have already been included in the decision process. When ence may permanently eliminate the brand from consideration, capacity is constrained during periods of prosperity the importance while even the preferred brand must continuously meet or exceed of branded products increases exponentially. The growth in brand expectations or face elimination from the set of acceptable brands, specification of aftermarket products, by both fleets and owner/op- so it follows that brand importance must not be underestimated. erators, is a gauge of the degree that buyers equate brand and quality. Despite the economy, high diesel prices, consolidation and cost cut- These generalizations, and the average rate of brand specification, ting in many fleets, most fleet managers and owner operators have vary substantially by product category for fleets and owner/operators. strong preferences for branded replacement parts. To remain profitable, fleet managers must focus intently on the bot- The majority of fleets (57%) specify the brand of replacement parts, tom line and the occurrence of specific brand requests has begun to and are much more likely to select products by brand than owner/ decline for both fleets and owner operators. Slower business during operators (47%). The for-hire commercial carrier reports selecting a downturn means fewer loads and when combined with the high the brand name of an aftermarket product 61% of the time, and a price of diesel, it puts considerable pressure on the profitability fleets brand is specified in only 51% of the private fleet purchases. When and owner/operators. In these conditions, the growing availability combined, 53% of all fleets and owner/operators in the survey of imported replacement products, with tremendous price advan-

Tr uc kin g O pera specify some replacement parts by brand. tages, could potentially erode brand importance.

Brand Specification of Replacement Components t ors Su r v ey

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20 The 2009 Global CommerHDMAcial Vehicle Report Outsourcing: Overview

Although we can now break out private fleets, and even their indus- Levels of In-house Service of those Operations that try segments, we have combined them here so that the historical es- do not Outsource All Work timates from previous studies can be used for comparison. This gives readers the ability to look at long-term trends for fleets and owner Owner Operator operators, and still view current results with the detail provided by having the fleet types broken out by industry.

Fleet outsourcing averages 19.1% of all service jobs, this is the new low for the series. Outsourcing by owner operators had rebounded in 2006 from the low point of 39.3% set in 2004, and although down slightly from the last measurement, the level of outsourcing was at 47.5% in 2008, still well above the all time low.

In this survey, 64.2% of the total sample do not outsource any work at all, and perform all repairs and preventive maintenance in their own shop. The level of outsourcing with respect to the overall magnitude of the service job is shown in the accompanying pie charts. For Hire Fleet

Levels of Outsourcing t ors Su r v ey

Private Fleet Tr uc kin g O pera

All Fleets Property of Property of

(PM = Preventive Maintenance) HDMA The 2009HDMA Global Commercial Vehicle Report 21 Where Outside Repair is Performed

The selection of a service provider depends upon vehicle and com- repair although they have lost share from the average 20% share ponent warranties, vehicle age, leasing vs. owning, vehicle complex- since 1999. Vehicles used in long haul operations are more likely to ity, distance from an in-house repair facility, and overall cost. be in use beyond the service radius of their home bases and account for most of this sustained market share. In the studies since 2002, truck dealerships have maintained the largest share of the outsourced service work and in 2008 were cited The choice of outside service provider also depends on the nature of as the service provider by nearly 43% of vehicle maintainers in this the operation. Commercial carriers and some private fleets tend to study. General repair shops are the second most frequently chosen have newer vehicles and are more likely to utilize the truck dealer service provider with a 39.7% share of outsourced repair. Truck than owner operators who are more likely to frequent general repair stops are still an important service outlet, with 17.8% of outsourced shops.

Where Outside Repair is Performed

Overall 1978 1984 1990 1994 1999 2002 2003 2004 2006 2008 Dealerships 54.9% 45.7% 45.1% 42.1% 37.8% 45.9% 41.5% 42.0% 40.7% 42.5% Truck Stops 6.2% 6.2% 5.7% 11.3% 20.4% 10.4% 20.6% 23.6% 22.6% 17.8%

Tr uc kin g O pera General Repair 38.9% 48.1% 49.2% 46.6% 41.8% 28.9% 37.8% 34.4% 36.7% 39.7%

Fleets 1978 1984 1990 1994 1999 2002 2003 2004 2006 2008 Dealerships 59.7% 45.8% 48.8% 43.1% 35.1% 50.4% 47.1% 44.4% 43.3% 44.5% Truck Stops 6.5% 9.3% 4.1% 11.9% 22.5% 5.3% 17.9% 21.3% 23.1% 16.0% General Repair 33.8% 44.9% 47.1% 44.9% 42.4% 25.0% 34.8% 34.3% 33.6% 39.6%

Owner operators 1978 1984 1990 1994 1999 2002 2003 2004 2006 2008 Dealerships 50.0% 45.7% 41.5% 40.3% 40.4% 40.5% 39.1% 39.6% 37.6% 38.5% t ors Su r v ey Truck Stops 6.0% 4.5% 7.4% 10.1% 18.4% 17.2% 21.9% 25.9% 22.1% 21.1% General Repair 44.0% 49.8% 51.1% 49.6% 41.2% 33.7% 38.9% 34.5% 40.2% 40.4%

Dealership Shares of Outside Repair

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22 The 2009 Global CommerHDMAcial Vehicle Report Where Outside Repair is Performed

Overall Owner/operators

Commercial Carriers Private Fleets t ors Su r v ey Tr uc kin g O pera

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HDMA The 2009HDMA Global Commercial Vehicle Report 23 Trends In Outsourcing

Anticipating change in the level of maintenance outsourcing is key time of vehicle acquisition may dictate the actions the fleet manager to marketing strategy. Outsourcing practices have traditionally re- or owner/operator. volved around the distance from the vehicle to the home operation and the cost differences between in-house maintenance and outside When asked about expected changes in the levels of service out- service providers, the age of the vehicle and the availability of parts sourcing over the next three years, only 20.5% of the owner opera- and access to properly trained technicians. Warranties, vehicle tors and fleet managers said outsourcing was expected to increase, manufacturer up-time programs, and maintenance agreements at the while the majority (57.6%) anticipate no change in their level of outsourcing.

Where Outside Repair is Performed

Outsourcing Outsourcing no Change Will Increase Will Decrease in Outsourcing net Change Owner Operator 21.4% 20.0% 58.6% 1.4% For Hire 20.0% 18.6% 61.4% 1.4% Tr uc kin g O pera Private Fleet 20.0% 27.1% 52.9% -7.1% Total 20.5% 21.9% 57.6% -1.4% Ag., Mining, Forestry, Oil Field 19.0% 33.3% 47.6% -14.3% Production and Distribution of Goods 11.8% 41.2% 47.1% -29.4% Construction 35.0% 15.0% 50.0% 20.0% Other 8.3% 16.7% 75.0% -8.4% t ors Su r v ey Expected Annual Change in Outsourcing Expected Annual Change in Outsourcing for Private Fleets

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24 The 2009 Global CommerHDMAcial Vehicle Report In-House Repair Capability

The ability to carry out routine preventive maintenance, minor Levels of In-house Service of those Operations that repairs, and most major repairs requires both the assets and the need do not Outsource All Work for heavy duty operations to bring these tasks in-house. Fleets and owner/operators indicate that 68% of their in-house repair facilities Owner / Operator are capable of major repair tasks and that 43.9% are only capable of minor repairs. Very few operations (6.9%) with repair capability do not carry out routine preventive maintenance while only 1% of the respondents doing any in-house maintenance report performing only preventative maintenance.

A fully equipped machine shop reflects the type of repair not ability to perform major repairs. Unlike last year, owner operators have the greatest likelihood (19%) of having a fully equipped machine shop while only 12% of the commercial carriers and 17% of the private fleets report that they have a fully equipped machine shop.

Commercial Carriers

Operations With a Fully Equipped Machine Shop

Owner-Operators 34.3% For Hire/Common Carrier 32.9% Private Fleet 27.1% Agriculture, Mining, Oil-field. Forestry 23.8% Production and Distribution of Goods 23.5%

Construction 30.0% t ors Su r v ey Utility and All Other 33.3% All Operations s Combined 31.4%

Private Fleet Tr uc kin g O pera

Levels of In-house Service Preventive PM through PM and minor Repairs Only Major Repair Repairs No PM Owner/operator 1.0% 30.3% 61.2% 7.5% Property of Commercial Propertycarriers 1.2% of71.9% 26.9% 0.0% Private Fleet 0.6% 71.0% 27.7% 0.6% All Operations Combined 1.0% 71.4% 27.3% 0.3%

HDMA The HDMA2009 Global Commercial Vehicle Report 25 Parts Inventories

Although heavy duty parts inventories are not always large, parts in- private fleets (20.0%) are likely to have more than $50,000 invested ventories are maintained by almost all of the vehicle maintainers in in parts while 21.4% of the commercial carriers have inventories the survey. A substantial number of owner/operators (68.6%) main- valued at that level. The largest fleets, in terms of parts inventory, tain an inventory of less than $10,000, and only 2.8% report service maintain inventory levels in excess of $100,000 and consisted of parts inventories greater than $50,000. A larger segment of the 21.4% of the survey population.

Dollar Value Of Parts Inventory

Size of Parts Inventory less than $10,000 $10,000 to $50,000 $50,001 to $100,000 over $100,000

Owner/Operator 68.6% 28.6% 1.4% 1.4% Commercial Carrier 51.4% 27.1% 14.3% 7.1% Private Fleet 44.3% 35.7% 7.1% 12.9% Tr uc kin g O pera

Dollar Value Of Parts Inventory t ors Su r v ey

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26 The 2009 Global CommerHDMAcial Vehicle Report Heavy Duty Distributor Survey

In the HDMA 2008 survey of heavy duty distributors, 69% were reflecting the level of uncertainty about most other factors in store members of a marketing/buying group. However, only 12% of the for the industry. In t 2006, the most frequently mentioned expecta- members of marketing/buying groups purchase exclusively through tion was for a period of constant, but modest, growth over the next the group. Of the distributors in the survey, 96% sell directly to five to ten years. municipal fleets and 91% provide remote jobsite deliveries or and services. In 2008, 35% of the distributors report that they purchase Evolution of the Heavy-duty Aftermarket products directly from off-shore sources, up from 31% in 2006. as Seen in 2006 The distributors have increased their level of information sophistica- tion, and in 2008 28% reported using business intelligence or data mining software, this is up from 24% in 2006. Also, 38% (20% in 2006) report that they are involved with vendor managed inventory with their suppliers.

We asked heavy duty distributors again in 2008 about the single most important challenge facing the industry. The distributors provided numerous comments about specific issues. An example of the nature of the comments is: “making sure we on top of changing technology, and training our personnel for tomorrow’s challenges!” When the replies were grouped into broader topics, rising costs topped the list of things that “keep them up at night.” When rising Evolution of the Heavy-duty Aftermarket costs and fallout from the economic downturn are combined, it as Seen in 2008 becomes apparent that 42% of the troublesome issues are related to economic conditions.

What kept you up at night in 2006

As anticipated, the most important benefit given for being a member of a marketing group was price and buying power. After price, access

to national fleet customers and suppliers tied with general business v y Dut D is t rib ut or Su r ey support. What kept you up at night in 2008 H ea Most important benefit of membership in a marketing group

Property of Property of We also repeated the question about the future of the heavy-duty parts and service business, and how it is expected to evolve in the next five to ten years. When the replies are grouped into categories, by far the most frequent assessment was for increased consolidation,

HDMA The 2009HDMA Global Commercial Vehicle Report 27 Heavy Duty Distributor-Supplier Relationship

Distributor Demographics The vast majority (91%) of the distributor companies in the survey Share of customers that are fleets provide remote jobsite deliveries or other services, but nearly one- of ten or more heavy duty vehicles third (32%) do not offer any shop services, not even machine shop services. Most of the distributors (64%) have a market area that ex- Less than half 36% tends beyond their state border, and more than three-fourths (77%) More than half 34% operate from more than one location. Almost all (96%) of the Half 15% distributors in the survey have customers who operate fleets of ten or more heavy duty vehicles, and an equal proportion have municipal All or almost all 11% fleets as customers. None 4%

The following tables present the demographic details of the heavy duty distributors who participated in the survey. They will be helpful in the decision to generalize from the survey data, but should not be interpreted as descriptive of the total population of heavy duty distributors. Number of locations distributor’s company operates H ea Distributor’s market area 2 to 5 locations 34% Single location 23%

v y Dut D is t rib ut or Su r ey Multi-state 55% 6 to 10 locations 23% Statewide 23% More than 10 locations 19% County or City wide 11% National 9% Local 4%

Marketing/buying group affiliation Vehicle and shop services are offered

Vipar 41% Have service bay and perform Heavy Duty America 35% most maintenance and repairs 49% Truck Pride 14% Machine shop 34% Power Heavy Duty 6% None 32% Other, please specify 5% Minor installations 13%

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28 The 2009 Global CommerHDMAcial Vehicle Report With the downturn in the economy and its impact on prices and Information Needs and Topics of Interest growing competition, the relationship between the heavy duty sup- Heavy duty distributors were asked about their needs for specific plier and the distributor is growing in importance. When faced with information or business assistance that could help them in their increasing prices, distributors who trust that the supplier is attempt- day-to-day operations. The scores are scaled to show any item below ing to cover increasing input costs will be more understanding, while 50% has a below average level of interest, and the item with the those who do not may look elsewhere (offshore) for lower prices. maximum posible level of interest would score 100%. The relationship between the distributor and the supplier is key as it relates to price/cost issues. Decisions on sourcing are greatly Importance of Education and Training Topics affected by a suppliers’ ability to justify price increases. With 84% of the chosen descriptors being positive, the results clearly show that Educational resources...... 83% most distributors feel that they have a good relationship with their Best business practices...... 80% suppliers. Electronic Data Interchange (EDI)...... 74% Inside and outside sales training...... 73% Technical and product training...... 69% Distributor view of the relationship Credit reporting and financial rating services...... 64% with suppliers. Business liability exposure...... 60% Partner 50% Detecting and reporting counterfeit parts...... 56% Adversary 2% Barcodes and RFID...... 54% Necessary evil 7% Compliance with local, state and federal laws...... 50% Supportive 21% Part of the problem 4% Important Operational Issues and Information Needs Collaborator 5% Suppliers national warranties...... 80% No relationship 4% Key employee succession planning...... 79% Helping 4% Inventory management...... 75% Part of the family 4% Insurance, pension, worker’s comp and other benefit issues...... 73% Obtaining the OE diagnostic information required to service newer heavy duty vehicles...... 73% Lean operations...... 72% Recruitment and retention...... 72% Distributors’ Relationship with Suppliers State safety and emissions inspection programs for commercial vehicles...... 71% Federal Motor Vehicle Safety Standards (FMVSS)...... 66% Industry wide standards for e-commerce...... 66% Promoting repair, safety, or decreased emissions of commercial vehicles...... 64% v y Dut D is t rib ut or Su r ey

Specific Areas Where Assistance is Needed H ea Supplier help in finding new customers...... 77% Help with Barcode and RFID...... 63% Logistics integration...... 61% Supplier assistance with merchandising and floor space optimization...... 60% Help with inventory management...... 60%

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HDMA The HDMA2009 Global Commercial Vehicle Report 29 Overview of Fuel Related Issues

Fuel Prices with the pump price adjusted for inflation, reached a high in June On-highway diesel fuel reached three dollars per gallon for the first that was 160% above the price in January 2002. In November time at the end of September 2007, the end of February 2008 saw 2008, despite some easing, the inflation adjusted price was still the first national average of $3.50, mid April the first four dollar double that of the January 2002 price. average, and the end of May, $4.50 per gallon. Although prices have begun to abate, they are still about twice as high as they were in the Diesel consumption is a function of the volume of freight transport- beginning of 2003. ed on America’s highways and even with high diesel prices consumption has continued to grow. With the rapid deceleration in the The persistent increase in diesel prices that began in 2002 is not economy consumption has declined, even while diesel prices abated. simply the result of inflationary pressures. The real price of diesel,

U.S. Diesel Price and Consumption O pera t in g F a ct ors

Source: Energy Information Administration and U.S. Department of Labor

Fuel Taxes Total Fuel Taxes 2006 Diesel is the dominant fuel for heavy duty trucks, having almost cents per gallon, state average is weighted complete market dominance. There are emerging but limited alternative fuels in use, such as CNG, LNG and propane. These are concentrated in special purpose applications such as city buses and refuse fleets. Taxes on diesel are, therefore, a tax on all portions of all industries that contribute to the production, maintenance and operation of heavy duty vehicles.

Diesel taxes become an operating expense that is passed onto consumers. Every product that is shipped by truck has a portion of its price due to diesel taxes. Given the preponderance of truck ship- ping for consumer goods, diesel taxes cost even those people who never buy a single gallon of the fuel. It is surprising to see that diesel fuel taxes are higherProperty than those for gasoline. of

Diesel fuel and the taxes built into the pricing constitute the largest line item expense for any trucking operation. As fuel prices increase, cost recovery via surcharges are utilized. These increased Source: United States Department of Transportation (DOT) Federal Highway costs eventually appear in the pricing of all consumer goods. Administration (FHWA) Office of Highway Policy Information (OHPI) Highway Statistics 2006

30 The 2009 Global CommerHDMAcial Vehicle Report Federal taxes make up 55% of total diesel taxes when combined with Petroleum Consumption History the weighted average of state taxes. However, there is great variance millions of barrels per day in the amount of state taxes, ranging from a low 7.5¢ in Georgia to a high of 38.1¢ in Pennsylvania. Considering the wide reaching impact of diesel taxes, it is disturbing to see an upward trend in state taxation levels. The weighted state average tax per gallon has grown by seven-and-a-quarter percent in the last decade. The highest state tax rate has jumped a shocking 31.3% in ten years.

State Diesel Taxation Levels, 1992-2005 cents per gallon, state average is weighted

Source: U.S. Department of Transportation (DOT), Research and Innovative Technology Administration (RITA), Bureau of Transportation Statistics (BLS), National Transportation Statistics 2008

U.S. Petroleum Demand By Sector quadrillion BTUs annually

Source: United States Department of Transportation (DOT) Federal Highway a ct ors Administration (FHWA) Office of Highway Policy Information (OHPI) Highway Statistics 2006 t in g F

National Fuel Use The first 8 years of this century have been proven to be a tumultuous time for oil prices. Crude oil, gasoline and diesel prices have experienced volatility never before seen. Yet demand for and consumption O pera of petroleum products are vital to the well-being of all American citizens, so even in the face of unprecedented prices, petroleum use has not reported a significant decrease.

As petroleum consumption increases, the share of imported product has increased as well. Net domestic petroleum production was Source: U.S. Department of Transportation (DOT), Research and Innovative responsible for meeting just 40% of total consumption in 2006. In Technology Administration (RITA), Bureau of Transportation Statistics (BLS), 1996, domestic supplies were almost 54% of consumption and in National Transportation Statistics 2008 1986, they covered approximately two thirds of all demand. Fuel Use by Transportation Mode As the power source for the main economic activity of the sector, The breakdown of petroleum consumption by transportation mode transportation dominates the use of petroleum. However, in spite follows readily observable trends. Light vehicles dominate as the of increasing vehicle travel that share has not risen greatly in the most popular mode of travel, and, consequently, they dominate fuel last ten years. For 2006, transportation consumed 68% of petroleum consumption as well. More than two thirds of all petroleum fuels are volume, up just 3% from 1996. Industrial petroleum use accounts consumed by light vehicles, dwarfing any other category. 24% of the total, with the balance going to utility, residential and

commercial use. Property of Property Of theof remainder, heavy duty vehicles have the largest share, accounting for just over seventeen percent of the total US petroleum consumption. This number is primarily diesel fuel, while light vehicle consumption is concentrated in gasoline. Aviation, using mostly jet fuel, consumes about seven-and-a-half percent, and waterborne transport consumes about four percent of the total, the

HDMA The 2009HDMA Global Commercial Vehicle Report 31 bulk of which is fuel oil. Rail transport, like heavy vehicles, uses decreases is difficult to find (it has been a rare occurrence) it is diesel overwhelmingly, but only 2% of the total. Transit is powered difficult to speculate how travel by different vehicle types will vary by various fuels, including CNG (compressed natural gas), which through the decline. register no presence in other groups. Yet at under half-a-percent, transit consumption is only a very small portion of use. Since heavy vehicles are operated for business purposes, it is harder for companies to trim mileage. There are no pleasure drives to the mountains to cut out like a family can. However, as the economy Petroleum Consumption by Vehicle Type slows, the demand for services declines, and the miles covered will Millions of gallons of fuel logically decrease also. The difficulty is that a full truck, with orders from a booming economy, is often times covering the same mileage as a half-full truck that is a reflection of less prosperous times. Scheduled, rather than volume dependent, freight is a variable that shows little or no change in mileage, despite shrinking volumes. A safe assumption is that the reports of increased ridership on city transit services will lead to an increase in bus mileage.

Heavy Vehicle Travel by Type in millions of miles O pera * MEMA estimate for Amtrak Source: U.S. Department of Transportation (DOT), Research and Innovative Technology Administration (RITA), Bureau of Transportation Statistics (BLS), National Transportation Statistics 2008 t in g F

2005 Vehicle Type Petroleum Consumption Share a ct ors Source: U.S. Department of Transportation (DOT), Research and Innovative Technology Administration (RITA), Bureau of Transportation Statistics (BLS), National Transportation Statistics 2008

Daily Motor Vehicle Travel Total single Combination buses miles Unit Trucks Trucks 1997 7,015 182 344 21 1998 7,193 187 352 22 1999 7,341 191 360 22 2000 7,526 196 369 23 2001 7,659 199 375 23 2002 7,823 211 383 16 2003 7,919 214 380 16 * MEMA estimate for Amtrak 2004 8,116 211 390 16 Source: U.S. Department of Transportation (DOT), Research and Innovative 2005 8,199 213 394 16 Technology Administration (RITA), Bureau of Transportation Statistics (BLS), National TransportationProperty Statistics 2008 2006of 8,258 215* 396* 17* 2007 8,228 222* 395* 17* Travel Trends Total vehicle travel has experienced declines in 2007 and 2008, Source: U.S. Department of Transportation (DOT), Research and Innovative bringing to an end the years of steady growth that were a hallmark Technology Administration (RITA), Bureau of Transportation Statistics (BLS), of strong economic activity. Heavy vehicles contribute an estimated National Transportation Statistics 2008 and TVT reports 7.6 to 7.8% of the total. Since data on year-over-year mileage * MEMA estimate Energy and Environmental Impact

32 The 2009 Global CommerHDMAcial Vehicle Report Heavy Duty Fuel Economy Improvements

While the reduced efficiency from the 2007 introduction of ULSD U.S. Bus Operation and Activity (ultra-low sulfur diesel) and EPA 2007 engines have caused concern among the heavy duty vehicle operators, heavy duty vehicles have been ahead of the curve when it comes to improving mileage. Ultra- low sulfur diesel is 15 ppm sulfer, while low sulfur diesel is 500 ppm.

Fleets with diesel fuel as their #1 expense have long identified fuel economy as one way to reduce operating costs. Unlike the consumer for whom fuel prices have meant little to their overall budget until recently, fleet operators responsible for millions of miles of operations have always been aware that fuel efficient trucks and operating practices are a wise investment. As a result, long before the recent price increases, trucks have been improving their fuel economy.

Since 2000, straight trucks (not tractor trailers) have posted a nearly 11 percent gain in fuel economy. Tractor trailers are up just over 11 percent. In the same time period, car fuel economy rose by just 4.5 percent, while light truck fuel economy fell by nearly seven percent.

Heavy duty vehicles also play an important role in fuel use reduction through mass transit. Bus mileage declined around the turn of the Source: United States Department of Transportation (DOT) Federal Highway millennium, but is in the process of regaining most of the amount Administration (FHWA) Office of Highway Policy Information (OHPI) Highway lost. Registrations did not decline, and continue to grow. Increasing Statistics 2006 fuel prices are likely to place greater importance on mass transit and make bus travel more attractive.

Fuel Economy Improvements by Vehicle Type a ct ors 2000 = 0 t in g F O pera

Property of Property of

Source: U.S. Department of Energy, Transportation Energy Data Book: Edition 26–2007

HDMA The 2009HDMA Global Commercial Vehicle Report 33 Emissions Reductions l Although heavy duty vehicles make up a relatively small portion of Hydrocarbon emissions cut in half in the last ten years l the highway vehicle population, like all vehicles, the industry has Carbon monoxide emissions down 30% in the last a responsibility to minimize their products’ impact on the environ- five years l ment. In this, they are excelling. Every major category of pollutant Oxides of nitrogen emissions halved in the last eight years l has reported significant decreases in emissions from heavy duty truck Particulate emissions from all highway sources down by a sources. third in the last decade

Estimated Emissions from Heavy Duty Vehicles Oxides of Nitrogen Emissions Hydrocarbon Emissions Grams per mile Grams per mile

Carbon Monoxide Emissions Particulate Emissions Millions of short tons from highway sources

O pera Grams per mile t in g F a ct ors

Source: United States Department of Transportation (DOT) Federal Highway Administration (FHWA) Office of Highway Policy Information (OHPI) Highway Statistics 2006

Two Decades of EPA Diesel Emissions Regulations

Property of Emissions standards for Heavy Duty vehicles have been established by the U.S. Environmental Protection Agency (EPA), and in just 20 years emissions from trucks have been drastically reduced. By 2010, the stunning progress made by the heavy duty vehicle in reducing their pollution goals will have reduced Nitrogen Oxides (NOx), created when fuel burns in motor vehicle engines, by 97%, and particulates (PM), essentially soot from the exhaust, by more than 98%.

34 The 2009 Global CommerHDMAcial Vehicle Report Technology and Innovation celeration. In addition, the Hybrid EP System can use the hybrid components to automatically determine when high idle is needed, Hybrid Power - and implement the change without input from the driver or inter- Exploring Heavy Duty Vehicle Options ruption of service. Finally, GM Allison uses hybrid power in concert In response to rising fuel prices, hybrid light vehicle have become with electronic traction control to enhance overall stability through increasingly popular. A hybrid vehicle is one that has two sources torque output adjustment. Increasing capabilities allows for increas- of power. The most common hybrid vehicles combine internal ing number of customer who will see a positive return from purchas- combustion and electric power in one vehicle. The internal ing a hybrid vehicle. combustion engine is used provide motive power, as in a conventional vehicle, but also generate electricity for the batteries. During In November 2006, New York City Transit released their report electrical power generation, the internal combustion engine can be evaluating second generation hybrid diesel buses against CNG run at peak BSFC (brake specific fuel consumption) to maximize the (compressed natural gas) buses. This report gives some of the most energy content extracted from the fuel used. The batteries power an precise, quantifiable benefits from the use of hybrid buses to be electric motor which can start the engine and provide power assist found. The major findings include: to reduce fuel consumption. The batteries can also be recharged by a regenerative system which captures energy from braking. l 34% increase in fuel economy over conventional buses The prospects for hybrid power in the heavy duty market are mixed. l 60 to 120% better fuel economy than CNG (co Long-haul, over-the-road trucking is a relatively poor fit. With min- pressed natural gas) powered buses being evaluated at the imal braking, there is little opportunity to capture braking energy for same time. battery recharge and the large number of gears provides a ratio selec- l 5% lower per mile maintenance costs than CNG tion to optimize fuel efficiency at most any legal speed. Conversely, buses city buses are a perfect fit. Frequent stops provide recharge opportu- l 79% in brake parts cost compared to CNG buses nities while battery power assist during acceleration away from the l Implementation costs of $70,000 (per bus) battery stops would be equally commonplace and provide meaningful fuel conditioning stations compared to $9.4 million in CNG consumption decreases. Furthermore, with bus operation principally facilities required in urban areas, the potential reduction in emissions will provide another incentive for hybrid buses. While city buses remain the optimal heavy-duty application for hybrids, the experiences of NYCT show that there are clear benefits Between these two extremes exist most heavy duty vehicles. The when hybrid power is used. suitability of hybrid power depends on the use of the vehicle more

so than the vehicle design itself. While a city bus is seemingly ideal Other Innovations a ct ors for hybrid system, intercity bus-lines operate under conditions closer Innovations in heavy duty don’t end with hybrids. Every year parts to those of long-haul trucks. Assuming all buses would benefit from and vehicle manufacturers provide new ways to optimize operation hybrid power would thus be incorrect. Manufacturers, likewise, of America’s heavy duty fleet. In recent years, all sectors have seen

cannot make assumptions on integration of hybrid systems on a the proliferation of computer-based technology in new products, and t in g F vehicle-by-vehicle basis. the trucking industry is no exception.

For model year 2009, Peterbilt will offer the Model 330 Hybrid Computerworld has even taken notice of the heavy duty truck Electric medium-duty, van body truck. With a 26,000 pound GVW innovations, reporting on Electronic Onboard Recorders (EOBR). rating, Peterbilt describes the Model 330 Hybrid Electric as “a An EOBR is a digital driver log that uses extra inputs not available O pera versatile, environmentally friendly and profitable performer in urban when using traditional paper logbooks. Not only can an EOBR and congested areas”, showing how market, not model influences record all the information required for DOT logs, it can reference the selection of hybrid truck. The Model 330 is joined by the Class them to GPS (global positioning system) data and vehicle sensor 7 Model 335, which is designed for sanitation and other city uses, data. For example, if the vehicle speed sensor indicates the truck is which have significant idle times. The hybrid shutoff and restart moving, a driver will not be able to input that he is on rest. allow for a claimed 80 percent idle time reduction in service. Beyond driver log entry, an EOBR will record truck location based The Peterbilt system employs 110 pounds of lithium-ion batter- on GPS feed. When a truck arrives at its destination on time, ies, which the manufacturer claims equal the performance of 1900 the EOBR will provide a record for both the fleet operator and his pounds of sealed lead acid batteries. The hybrid motor generates up customer. Producing reports that show on-time delivery percent- to 60 horsepower, to supplement the diesel engines output of 260. age based on computer generated data rather than the traditional In addition to electric motors Peterbilt has announced a hydraulic method of a receiving clerk entry or stamp, could be persuasive tool energy recovery system that store braking energy in an accumulator for demonstrating value to customers. and releases it under acceleration. In testing, the Hybrid Hydraulic Assist System provided a “28% improvement in fuel economy, 28% Looking ahead to 2010, companies are already investigating the abil- reduction in emissions, and 50% reduction in brake wear.” ity to exploit the EPA mandate for onboard diagnostic (OBD) sys- Property of Property temsof in heavy duty vehicles. Light vehicles have had standardized GM Allison has demonstrated hybrid system capabilities that go far OBD systems for over a decade and the ability to diagnose problems beyond what are found in currently available light vehicle applica- by interfacing with the standardized port is now an indispensible tions. The GM Allison HyGain System uses hybrid technology to tool for today’s technicians. OBD will bring that benefit to heavy allow fleet operators to electronically program vehicles to operate duty technicians, but will also offer opportunities to fleet operators at a variety of calibrations for fuel-economy versus vehicle ac- that are not part of light vehicle operation.

HDMA The 2009HDMA Global Commercial Vehicle Report 35 Truck Exports

Used Trucks Studying the average value of the tractors exported can provide an Trade data for tables, charts and text is from the Trade DataWeb indication of the age and condition of the vehicles. Mexico remains maintained by the United States International Trade Commission of the destination for the cheapest used road tractors. Comparatively the U.S. Department of Commerce. Export values are F.A.S. (Free minimal transportation costs likely make purchase of the lowest Alongside Ship), which includes delivery to port, insurance and value units a possibility for export to Mexico. Whether these trac- other charges needed to place the product ready for shipment. tors are run or used for parts is unknown.

Used road tractor exports have exploded in the past two years, European nations typically import the highest value used trucks. doubling in number from 2006 to 2007. Estimates based on first This likely reflects their more strident road worthiness criteria half volume projects that used road tractor exports will eclipse the compared to less developed nations. Russian units are slightly above half-billion dollar mark in 2008. The growth of tractor exports has average in value as well. Buyers in African and Latin American na- been nothing short of meteoric, increasing by a factor of ten in as tions typically purchase units of less than average value. many years. Vietnam is the anomaly. With an economic level more akin to The steady U.S. trading partners of Canada and Mexico are well the African and Latin American nations than those of Europe, it represented in the used tractor trade; however, the most popular would be logical to presume that the used road tractors exported to destinations are increasingly far flung. Russia and Nigeria are the Vietnam would be of similarly below average value. Quite to the two leading purchasers of used America road tractors, and signifi- contrary, Vietnam leads the world in per-tractor purchase price, with cant growth has been reported in shipments to Vietnam and South a 2008 average of over $29,000. Africa. Costa Rica and Mozambique, two countries that play a minor role in overall U.S. trade are important players in the used road tractor trade.

U.S. Exports of Used Road Tractors for Semi-Trailers Countries Importing 200 or More Units between 2004 and 2008

Trade Country 2004 2005 2006 2007 2008 Estimate 5 Year Total Russia 547 1,528 3,026 5,867 12,513 23,481 Nigeria 616 1,299 1,834 2,798 5,800 12,347 Mexico 202 211 469 5,377 633 6,892 Canada 307 541 826 2,017 1,998 5,689 South Africa 286 356 735 731 912 3,020 Panama 113 279 410 956 940 2,698 Vietnam 401 29 6 610 1,640 2,686 Mozambique 168 451 492 389 431 1,931 Costa Rica 101 203 384 564 478 1,730 Guatemala 192 182 172 199 122 867 Dominican Republic 78 83 117 157 201 636 Namibia 18 37 52 90 218 415 Germany 6 22 103 118 358 607 Finland 7 129 126 207 25 494 El Salvador 107 125 111 86 65 494 Netherlands 11 14 9 165 151 350 Haiti 116 70 40 56 14 296 Honduras 38 27 43 70 63 241 Belgium 6 12 72 63 59 212 Jamaica Property28 56 50 of48 21 203 Other 739 598 634 513 2,055 4,539

Source: U.S. Department of Commerce, United States International Trade Commission, Trade DataWeb

36 The 2009 Global CommerHDMAcial Vehicle Report New Trucks Average Used Road-Tractor Export Value, 2008 Unlike used road tractor exports, new unit exports suffered a sharp drop in 2007. With the 2007 emissions standards compliance caus- Russia...... $21,746 ing some uncertainty among fleet buyers, domestic sales dropped significantly at the same time. It is likely that the same issues caused Nigeria...... $14,633 the decrease in volume for 2007. Mexico...... $12,221 Canada...... $18,659 While 2007 sales dropped by 22.8% compared to 2006, the good Vietnam...... $29,203 news for the industry is that export sales of new road tractors in the first half of 2008 are up 22% versus same period 2007. Average unit Panama...... $14,765 value is also within $20, so there has been no drastic price reduction South Africa...... $15,096 to entice the greater volume. Costa Rica...... $14,928 New road tractor exports are still overwhelmingly bound for Canada Mozambique...... $18,546 and Mexico. Clearly, the ease of shipment to those nations with Finland...... $23,346 which the United States shares a land border helps reduce total cost Netherlands...... $23,194 for the buyer and makes American made road tractors appealing in Germany...... $16,022 their markets. With approximately three-quarters of units sold to these two nations, road tractor export must remain concentrated on Guatemala...... $12,050 servicing these markets. Dominican Republic...... $14,594 Namibia...... $14,844 However, similar to the situation with used units, there are other nations emerging as good business partners for road tractor export- Belgium...... $29,176 ers. In the first half of 2008, South Africa imported more new road Honduras...... $13,723 tractors than Mexico. Australia imported almost 1000 new road El Salvador...... $13,283 tractors in 2007. Truck manufacturers and suppliers would be well served by keeping abreast of regulations in these markets in order to Chile...... $15,721 encourage this growth. Haiti...... $17,657 All...... $19,426 Heavy duty vehicle parts manufacturers need to be sure that they have market penetration for the supply of replacement components as well. Along with South Africa and Australia, Russia is showing Source: U.S. Department of Commerce, United States International Trade an increased desire for new American road tractors, which, based Commission, Trade DataWeb upon sales of used units, could offer significant potential. The United Arab Emirates and Saudi Arabia offer growth opportunities in the Middle East, while Chile, Peru and Colombia represent the Trade strongest markets in South America.

Used Road Tractor Volume and Unit Price Trend – 1996-2008* * HDMA Estimate

Property of Property of

Source: U.S. Department of Commerce, United States International Trade Commission, Trade DataWeb

HDMA The 2009HDMA Global Commercial Vehicle Report 37 U.S. Exports of New Road Tractors for Semi-Trailers nations with seven or more units purchased, Jan 2007 to Jun 2007

2007 2008 YTD 2008 YTD vs. 2007 YTD Units Value Per Unit Units Value Per Unit Units Value Per Unit World 15,924 $87,876 8,946 $87,858 22% -0.02% Canada 10,070 $91,880 5,994 $92,350 13% 0.51% Mexico 2,152 $72,294 664 $69,103 26% -4.41% South Africa 1,756 $83,886 974 $73,585 62% -12.28% Australia 932 $97,476 277 $100,300 -37% 2.90% Chile 175 $75,950 252 $64,682 180% -14.84% Russia 42 $75,513 120 $83,386 3900% 10.43% United Arab Emirates 65 $77,717 96 $103,412 1820% 33.06% Japan 0 N/A 50 $98,241 N/A N/A Peru 131 $84,517 13 $72,506 -68% -14.21% Saudi Arabia 102 $58,684 37 $55,714 -40% -5.06% Colombia 28 $80,410 67 $118,881 1240% 47.84% Costa Rica 18 $94,392 75 $87,274 N/A -7.54% Ecuador 59 $88,435 34 $83,268 0% -5.84% Israel 54 $97,252 22 $94,804 2100% -2.52% Iraq 63 $73,225 0 N/A -100% N/A New Zealand 43 $88,025 0 N/A -100% N/A Afghanistan 43 $73,239 0 N/A -100% N/A Dominican Republic 10 $117,418 27 $89,465 286% -23.81% Trade Venezuela 31 $76,935 6 $78,336 -73% 1.82% Algeria 27 $110,943 6 $86,514 200% -22.02% Nigeria 17 $85,063 11 $96,994 83% 14.03% Tanzania 15 $75,671 8 $80,735 -27% 6.69 Guatemala 9 $65,029 7 $83,643 N/A 28.62% Belgium 1 $91,885 14 $76,943 N/A -16.26% Trinidad & Tobago 3 $54,297 12 $76,473 N/A 40.84% Bahrain 0 N/A 13 $67,632 N/A N/A Singapore 11 $72,537 0 N/A N/A N/A Panama 3 $86,768 7 $50,574 N/A -41.71% Germany 10 $79,186 0 N/A -100% N/A Kazakhstan 0 N/A 8 $63,000 N/A N/A Korea 4 $65,500 4 $67,500 0% 3.05% Nicaragua 5 $109,159 3 $115,954 50% 6.23% Bahamas 0 N/A 7 $73,965 N/A N/A Jamaica 2 $39,250 5 $65,236 150% 66.21% Ghana 0 N/A 5 $112,000 N/A N/A Honduras 3 $82,273 2 $21,000 0% -74.48% Indonesia 3 $61,400 2 $112,908 N/A 83.89% Angola 5 $85,325 0 N/A N/A N/A China Property5 $71,200 0 of N/A N/A N/A Egypt 5 $66,471 0 N/A N/A N/A

38 The 2009 Global CommerHDMAcial Vehicle Report Total Value of New Road Tractor Exports

millions of dollars

Source: U.S. Department of Commerce, United States International Trade Commission, Trade DataWeb Trade

Property of Property of

HDMA The 2009HDMA Global Commercial Vehicle Report 39 U.S. Motor Vehicle Parts Trade

Parts trade data presented is a group of ten NAICS codes selected of the three to post growth since 2001. The almost $200 million by MEMA that best represent the motor vehicle parts trade with increase in exports to France since 2001 falls half-a-billion dollars minimal inclusion of extraneous items not principally for motor short of covering the over $700 decline in exports to Austria and vehicle use. Estimates presented here may not correlate to figures the U.K. However, as the lack of movement in the total exports published elsewhere due to more discriminating methods employed to Europe shows, this is more a case of diversification of production in the selection of NAICS product categories. locations than decline of all European industries. Exports to Europe are up 2% since 2001. Parts Exports Based on first half 2008 data, HDMA forecasts that parts exports will see a slight increase in 2008, for a total of $55 billion. The growth U.S Motor Vehicle Parts Exports level has slowed dramatically, to just 0.14%, compared to 5.86% in millions of dollars 2007 and 6.99% in 2006. The most notable occurrence is the drop in exports to Canada, the largest destination for American made parts. This is likely due to decreased volume by Detroit area manufacturers that regularly engage in large scale cross-border shipments. The Americas remain the dominant location for U.S. parts exports, accounting for about 80% of all parts exported. In 2007, for the first time, Europe was eclipsed by Asia and the Pacific as the region with second largest purchases of exported U.S, motor vehicle parts. This is due in large part to exports to China, which have more than doubled in the last five years. Japan remains the largest importer in the region, but volume is down by $200 million since 2003. In that same period, exports to China grew by $576 million.

In Europe, Germany is the only nation to which billion dollar U.S. * HDMA forecast motor vehicle part exports are made. The United Kingdom, Austria Source: U.S. Department of Commerce, United States International Trade and France all receive over $600 billion, yet France is the only one Commission, Trade DataWeb Trade

Africa

2001 2002 2003 2004 2005 2006 2007 2008* Africa $308,571,835 $118,117,176 $134,110,794 $146,444,035 $186,733,098 $290,042,942 $370,595,385 $369,726,922

South Africa $59,519,550 $58,492,662 $51,174,535 $67,956,044 $87,582,968 $139,056,717 $206,575,773 $221,299,120 Egypt $30,549,372 $24,750,981 $44,137,821 $47,176,891 $59,155,090 $62,210,536 $52,338,479 $47,937,795 Nigeria $10,056,072 $10,237,057 $10,249,753 $6,901,849 $6,795,992 $22,309,517 $29,584,807 $28,966,972 Algeria $7,458,261 $3,460,079 $6,481,840 $2,745,798 $5,857,902 $16,178,806 $13,950,226 $14,350,402 Angola $1,050,274 $1,122,833 $1,813,518 $1,648,625 $2,203,029 $7,005,715 $11,415,474 $9,874,780 Benin $38,700 $199,327 $60,853 $128,467 $86,987 $2,497,317 $5,116,214 $4,789,780 Libya $0 $0 $0 $254,083 $1,763,939 $3,466,901 $5,957,780 $4,716,372 Ghana $3,017,064 $1,877,319 $2,943,420 $2,365,086 $2,958,036 $2,613,646 $5,259,232 $3,497,184 Kenya $1,471,161 $1,116,526 $1,376,610 $1,441,359 $1,481,048 $4,673,303 $3,137,017 $3,221,320 Morocco $2,417,654 $2,228,696 $1,477,714 $3,185,689 $3,557,450 $4,037,312 $3,892,656 $2,650,157 Guyana $3,012,256 $3,136,027 $2,132,880 $2,901,601 $2,608,660 $2,979,177 $2,348,285 $2,547,224 Zambia $246,265 $255,841 $95,025 $205,117 $398,329 $2,002,799 $2,497,132 $2,160,678 Togo $32,249 $47,655 $96,679 $180,653 $55,996 $602,546 $1,649,679 $2,091,856 Tanzania $797,052 $917,964 $651,216 $988,415 $1,338,856 $1,196,864 $4,917,751 $2,042,674 Niger $2,596,068 $389,997 $438,136 $238,208 $333,550 $1,078,133 $1,529,500 $1,805,836 Namibia Property$174,220,850 $380,437 $136,478 $437,438of $395,663 $293,906 $1,887,838 $1,703,102 Congo (ROC) $375,870 $96,295 $89,049 $490,357 $1,114,504 $1,079,573 $1,180,297 $1,651,744 Equitorial Guinea $105,567 $288,760 $663,232 $616,930 $365,528 $1,615,452 $1,164,952 $1,278,858 Congo (DROC) $40,009 $44,234 $38,723 $17,160 $104,110 $1,784,915 $874,308 $1,217,086 Zimbabwe $523,317 $665,070 $1,293,073 $1,041,643 $1,199,039 $1,885,594 $1,666,525 $1,212,438

40 The 2009 Global CommerHDMAcial Vehicle Report Americas

2001 2002 2003 2004 2005 2006 2007 2008*

Americas $36,349,809,735 $36,363,928,307 $34,676,770,808 $37,648,567,723 $38,858,792,227 $41,429,415,269 $44,235,846,820 $44,222,533,939

Canada $24,165,568,848 $25,522,129,197 $25,020,938,349 $27,044,630,794 $27,943,852,395 $28,699,925,100 $30,259,759,911 $30,144,446,125 Mexico $10,565,775,988 $9,614,013,160 $8,472,869,406 $9,037,203,289 $9,123,240,519 $10,576,911,784 $11,386,390,492 $11,464,064,718 Brazil $406,198,688 $372,377,501 $405,645,856 $479,139,811 $461,258,811 $487,231,179 $601,269,490 $595,083,903 Venezuela $546,561,750 $263,882,299 $140,959,904 $327,644,870 $422,711,715 $536,818,842 $577,789,246 $551,427,590 Chile $80,678,019 $107,066,430 $105,007,920 $117,572,762 $146,305,058 $182,402,552 $243,058,866 $239,905,807 Argentina $134,093,923 $42,459,089 $116,755,927 $137,206,896 $164,594,405 $193,255,769 $232,072,985 $235,876,901 Honduras $27,963,066 $33,442,795 $33,263,969 $86,577,128 $115,406,433 $160,403,088 $176,814,186 $200,641,449 Colombia $62,997,713 $68,481,365 $61,802,502 $89,602,625 $102,826,299 $117,863,048 $132,728,962 $138,524,256 Guatemala $40,425,274 $45,806,673 $40,717,247 $37,916,807 $48,335,698 $65,089,466 $88,996,432 $94,829,772 Dominican Rep $70,172,789 $78,614,090 $60,861,160 $45,914,735 $45,443,908 $61,764,174 $81,100,209 $89,848,489 Peru $29,532,399 $31,376,317 $33,443,065 $32,374,226 $53,860,242 $56,137,975 $78,051,806 $80,356,521 Costa Rica $33,461,577 $34,570,935 $32,077,584 $26,265,028 $31,817,226 $42,395,690 $55,772,372 $61,217,124 Ecuador $54,171,995 $38,581,470 $38,867,465 $44,793,897 $45,992,979 $42,223,243 $44,290,007 $45,003,587 Panama $20,898,706 $13,823,093 $17,091,187 $16,586,257 $18,715,901 $25,212,795 $35,645,626 $35,043,571 Bahamas $11,214,832 $9,794,768 $10,898,554 $9,776,196 $11,775,676 $21,508,070 $24,564,590 $27,982,164 Jamaica $13,081,869 $13,513,136 $10,849,232 $12,647,224 $13,526,555 $17,659,252 $26,031,333 $27,026,816 El Salvador $14,501,298 $12,744,958 $14,362,273 $13,192,340 $11,541,498 $18,322,951 $26,200,615 $26,527,552 Paraguay $1,468,562 $1,870,363 $2,738,901 $7,203,974 $4,816,836 $8,964,449 $22,155,310 $24,966,788 Trin & Tobago $11,186,640 $10,207,282 $9,981,824 $12,579,505 $16,401,417 $18,143,530 $21,491,221 $19,559,951 Nicaragua $8,094,924 $6,870,859 $7,761,637 $17,697,137 $18,615,245 $8,528,282 $14,345,166 $12,943,654 Trade

Property of Property of

HDMA The 2009HDMA Global Commercial Vehicle Report 41 Asia and the Pacific

2001 2002 2003 2004 2005 2006 2007 2008* Asia And

the Pacific $3,893,772,130 $4,145,528,377 $4,142,537,407 $4,089,870,140 $4,197,471,696 $4,842,928,947 $5,361,958,428 $5,384,355,078

Japan $1,822,025,393 $2,059,118,740 $1,724,215,015 $1,207,299,627 $1,130,663,390 $1,407,107,183 $1,474,758,397 $1,559,107,112 China $264,173,292 $335,096,156 $473,718,098 $576,450,726 $608,050,175 $750,898,706 $1,014,260,588 $1,049,734,109 Australia $555,527,012 $579,065,518 $645,019,427 $771,314,195 $761,132,470 $790,727,031 $770,728,801 $773,922,163 Korea $338,911,670 $281,239,457 $274,151,575 $425,437,693 $504,303,171 $524,655,214 $519,242,286 $470,328,390 Singapore $118,798,137 $129,446,999 $137,694,227 $153,132,200 $158,774,140 $209,037,224 $237,404,319 $232,770,549 Saudi Arabia $166,162,926 $151,886,368 $154,841,872 $171,040,717 $165,022,130 $210,091,010 $221,522,490 $217,572,480 United Arab Em $44,459,324 $60,459,063 $70,071,944 $89,241,998 $88,939,444 $125,965,222 $173,592,709 $163,553,593 Philippines $37,528,567 $60,175,370 $86,063,034 $72,907,749 $109,031,789 $115,092,898 $114,916,410 $130,257,353 Hong Kong $112,799,933 $72,980,568 $90,110,630 $102,040,794 $109,129,185 $98,647,613 $118,385,955 $111,255,452 Thailand $82,697,838 $82,688,921 $95,484,593 $98,139,374 $98,533,780 $81,361,679 $113,299,311 $105,657,733 India $30,675,023 $22,239,157 $28,909,611 $46,397,251 $42,268,790 $67,458,129 $84,925,003 $85,733,638 Taiwan $85,847,403 $82,138,011 $127,044,539 $101,695,519 $101,481,774 $120,089,394 $81,554,865 $77,314,078 Kuwait $41,586,995 $40,066,211 $52,421,794 $56,217,129 $52,166,165 $45,723,094 $98,769,419 $74,590,343 Indonesia $17,781,910 $21,431,725 $22,412,474 $34,138,435 $32,022,382 $36,701,256 $46,450,407 $51,327,698 Turkey $17,712,712 $17,077,647 $13,754,907 $21,605,294 $35,672,507 $40,541,371 $50,979,159 $44,165,143 Israel $55,305,523 $54,346,021 $43,439,680 $43,085,095 $39,987,020 $44,783,344 $42,544,658 $41,495,978 New Zealand $16,487,416 $19,473,042 $16,687,256 $25,647,243 $29,173,128 $33,142,746 $39,469,189 $40,670,455 Malaysia $38,917,161 $28,637,236 $31,762,428 $21,760,800 $41,000,024 $28,803,814 $24,478,329 $24,331,796 Lebanon $7,687,122 $4,955,463 $7,827,662 $7,598,263 $6,022,150 $13,748,383 $22,135,166 $22,344,028

Trade Iraq $2,583 $18,000 $956,433 $14,584,963 $13,735,287 $27,053,189 $20,822,830 $21,390,178 Oman $3,719,685 $4,168,733 $4,333,003 $5,234,593 $10,384,341 $8,225,086 $13,392,551 $10,704,328 Afghanistan $24,673 $147,531 $1,057,316 $1,273,323 $3,483,220 $14,972,661 $7,796,114 $10,173,738 Qatar $3,560,767 $5,059,004 $3,697,656 $5,283,303 $6,867,435 $7,576,850 $11,882,118 $9,703,310 Jordan $2,217,597 $2,017,047 $2,875,344 $5,520,011 $7,063,659 $6,353,466 $7,399,504 $6,826,524 Pakistan $2,211,945 $1,935,985 $3,065,820 $3,256,303 $3,355,139 $4,941,594 $9,298,408 $6,646,949 Bahrain $4,369,749 $2,895,572 $3,247,757 $2,172,977 $3,044,315 $2,492,259 $5,252,054 $6,379,904 Mauritania $11,115 $125,579 $51,541 $221,851 $5,259,433 $2,132,924 $2,017,942 $4,582,635 Vietnam $6,175,520 $4,606,174 $8,506,516 $8,996,307 $12,797,641 $3,594,521 $6,412,285 $4,560,921 Kazakhstan $821,232 $723,764 $1,497,784 $1,890,806 $1,603,300 $2,394,345 $4,811,816 $3,837,994 Kyrgystan $35,778 $511,809 $22,404 $68,124 $63,889 $233,401 $1,891,646 $3,546,458

Property of

42 The 2009 Global CommerHDMAcial Vehicle Report Europe

2001 2002 2003 2004 2005 2006 2007 2008*

Europe $4,972,103,017 $4,638,288,410 $4,285,443,868 $4,353,133,581 $4,893,364,509 $5,190,783,040 $5,005,053,842 $5,071,315,952

Germany $1,004,061,934 $865,984,185 $823,773,256 $975,920,350 $1,123,506,956 $1,247,342,440 $1,176,831,719 $1,193,443,070 United Kingdom $1,094,898,680 $977,063,829 $946,613,597 $846,370,481 $694,279,534 $680,699,099 $712,078,965 $708,835,885 Austria $1,075,976,765 $910,926,743 $517,654,732 $446,979,206 $741,240,616 $813,697,253 $566,636,169 $623,273,337 France $404,857,122 $313,869,814 $329,119,798 $399,381,608 $514,940,447 $550,618,080 $603,501,013 $600,951,065 Belgium $341,053,633 $379,484,853 $348,821,261 $305,913,657 $267,071,884 $337,284,458 $379,358,428 $395,378,953 Netherlands $333,342,011 $323,292,826 $317,142,799 $320,311,347 $347,563,385 $394,413,126 $356,799,171 $356,106,397 Sweden $104,500,664 $149,698,377 $214,240,623 $256,242,896 $219,495,887 $217,588,930 $233,116,693 $235,195,455 Spain $90,916,546 $100,061,292 $124,691,897 $120,282,256 $243,741,128 $240,633,394 $221,706,262 $218,349,521 Russia $20,075,401 $15,977,170 $22,839,118 $26,692,765 $38,959,323 $114,007,523 $136,148,009 $159,509,346 Italy $133,092,077 $122,290,239 $145,282,899 $134,180,640 $130,833,295 $139,405,860 $155,368,297 $157,587,090 Hungary $19,464,567 $53,215,755 $66,482,276 $60,622,250 $47,617,955 $62,396,323 $64,636,311 $64,125,008 Ireland $53,387,228 $73,865,946 $89,356,095 $74,517,277 $108,869,231 $59,003,301 $60,574,042 $59,374,484 Poland $9,496,949 $13,675,761 $16,570,542 $16,825,614 $26,152,696 $44,447,049 $57,063,972 $58,809,591 Switzerland $163,441,784 $238,201,250 $198,344,663 $218,570,723 $245,753,668 $123,967,072 $70,300,890 $56,382,163 Finland $14,122,981 $11,337,391 $20,721,150 $25,978,744 $23,119,190 $32,530,632 $40,898,690 $41,438,315 Norway $14,863,391 $16,635,175 $20,552,011 $21,022,433 $26,624,758 $28,533,397 $36,005,822 $35,416,160 Portugal $56,590,135 $26,701,246 $24,629,957 $19,068,579 $15,913,841 $12,596,306 $22,031,800 $21,379,233 Czech Republic $7,767,534 $8,950,027 $8,262,552 $5,910,953 $11,844,103 $12,878,341 $20,371,540 $19,270,174 Denmark $9,657,008 $8,009,657 $7,822,272 $12,194,700 $13,727,199 $15,268,499 $11,716,557 $12,707,428 Greece $5,380,177 $3,975,072 $5,911,974 $8,948,973 $7,695,916 $8,034,139 $8,944,878 $8,690,375 Ukraine $1,779,550 $1,913,439 $4,264,416 $5,281,670 $3,216,283 $9,112,504 $9,810,754 $7,263,903 Iceland $2,462,755 $2,724,699 $3,200,026 $4,657,385 $8,057,827 $7,453,306 $7,444,783 $7,074,870 Romania $727,302 $3,462,787 $10,971,596 $19,596,489 $12,650,525 $7,526,764 $3,602,957 $4,850,826

Luxembourg $1,855,037 $2,751,503 $1,810,649 $3,901,819 $2,162,833 $1,264,443 $22,650,820 $4,002,108 Trade Slovenia $2,648,123 $2,619,146 $2,185,736 $2,885,504 $3,074,826 $4,397,561 $4,343,768 $3,941,528 Slovak Republic $675,608 $1,313,226 $2,650,725 $4,651,373 $2,983,951 $2,972,391 $2,728,824 $3,129,278 Estonia $712,080 $611,924 $623,977 $6,474,850 $1,149,383 $1,792,903 $4,036,141 $3,060,350 Latvia $472,760 $743,895 $1,721,090 $2,472,362 $2,579,283 $2,244,688 $3,644,369 $2,961,286 Lithuania $238,614 $3,427,973 $6,136,163 $4,156,689 $1,400,447 $4,259,098 $5,732,023 $2,592,662 Bulgaria $301,877 $458,997 $823,981 $900,986 $1,034,902 $1,176,546 $2,056,534 $1,646,760

Property of Property of

HDMA The 2009HDMA Global Commercial Vehicle Report 43 Parts Imports While the growth of China as a source of parts is impressive, Mexico Parts import values listed are for U.S. general customs value as is still the undisputed leader of nations in motor vehicle parts defined by the United States Department of Commerce. Motor exports to the U.S. Over a quarter of all imported parts come from vehicle parts imports are forecasted to show a trend-breaking drop in Mexico, and with transportation costs becoming a greater determi- 2008, falling two billion to a projected year-end total of $88 billion. nant in sourcing decision, Mexico’s preeminence seems secure for In 2007, imports rose by $5.4 billion to reach $90 billion for the some time to come. first time in a single year. As with exports, Canada and Mexico play the largest role in imported parts, representing the source nation of U.S Motor Vehicle Parts Imports almost half of all imports. millions of dollars

Again mirroring imports, it is a drastic change in volume with Canada that stands out as the largest single change in the forecasted 2008 total. Based on data for the first half of 2008, imports from Canada are expected to decline by over $2.3 billion by year end. Along with the struggles of Detroit automakers, a less favorable exchange rate has likely reduced the appeal of parts of Canadian origin and contributed to lower imports.

The forecast for overall import total may be lower, however this has not stopped all growth. Imports of parts from China are forecast to reach almost $10 billion. This is $8.2 billion higher than the amount reported in 2001, and means China is now fourth, behind Mexico, Canada and Japan on the list of sources for imported parts. Germany, fifth on the list, was surpassed by China in just 2005; * HDMA forecast yet by the end of 2008 is forecasted to have under two-thirds the Source: U.S. Department of Commerce, United States International Trade volume of the Asian giant. Commission, Trade DataWeb Trade Africa

2001 2002 2003 2004 2005 2006 2007 2008* Africa $258,197,568 $165,425,450 $175,405,675 $198,332,129 $286,551,274 $360,969,004 $446,504,811 $385,174,577

South Africa $255,012,545 $162,683,566 $170,030,353 $188,726,630 $269,028,142 $336,122,901 $420,918,154 $359,541,713 Morocco $888,021 $706,039 $2,493,233 $6,769,061 $13,268,029 $16,668,005 $19,576,609 $20,457,901 Tunisia $887,698 $1,162,956 $1,373,881 $761,087 $469,556 $574,970 $1,127,836 $1,668,160 Egypt $48,697 $52,167 $429,821 $847,229 $1,858,175 $2,741,921 $2,498,178 $1,616,783 Cameroon $0 $0 $32,563 $9,108 $50,395 $9,150 $312,404 $751,117 Sierra Leone $168,301 $208,233 $171,400 $268,110 $114,025 $223,328 $234,527 $182,047 Kenya $325,366 $36,398 $32,480 $353,028 $926,504 $3,361,701 $969,680 $138,657 Ghana $209,224 $0 $42,096 $28,862 $2,006 $0 $0 $137,742 Cape Verde $0 $0 $0 $0 $0 $3,496 $0 $129,988 Gabon $0 $13,357 $43,266 $0 $0 $24,943 $159,081 $125,783 Angola $0 $0 $0 $0 $7,610 $0 $0 $104,226 Guyana $298,014 $254,635 $173,102 $249,675 $232,498 $378,862 $212,316 $96,583 Niger $16,895 $6,072 $48,366 $0 $2,416 $102,164 $24,651 $87,438 Guinea $6,785 $17,493 $12,017 $0 $7,843 $0 $19,911 $29,654 Zambia $0 $0 $0 $0 $0 $0 $18,655 $28,788 Tanzania $0 $0 $0 $16,615 $0 $0 $69,962 $24,000 Djibouti Property$0 $0 $0 of$0 $0 $0 $20,928 $11,338 Sao Tome & Prin $0 $0 $46,662 $5,924 $0 $0 $144,565 $10,572 Cote d`Ivoire $18,032 $235,316 $35,833 $81,972 $0 $0 $2,250 $9,822 Algeria $0 $2,379 $0 $0 $282,292 $142,453 $6,344 $7,980

44 The 2009 Global CommerHDMAcial Vehicle Report Americas

2001 2002 2003 2004 2005 2006 2007 2008*

Americas $29,149,441,778 $32,634,024,438 $34,998,959,121 $38,741,010,021 $41,938,697,265 $42,574,082,527 $44,548,464,303 $41,782,527,897

Mexico $13,803,732,949 $15,694,328,151 $16,558,721,651 $18,469,397,039 $20,042,373,072 $21,516,367,361 $23,492,750,705 $23,133,331,201 Canada $14,369,049,032 $15,778,858,754 $17,063,957,180 $18,496,053,565 $19,751,697,740 $18,721,947,430 $18,846,888,202 $16,505,953,819 Brazil $595,340,016 $700,046,445 $806,237,269 $1,021,352,651 $1,218,372,190 $1,257,957,529 $1,194,203,192 $1,142,577,984 Honduras $52,229,417 $74,969,199 $98,553,761 $172,551,170 $269,762,880 $385,381,206 $394,750,773 $372,777,906 Nicaragua $8,174 $3,462,337 $38,692,908 $73,167,440 $121,007,000 $126,462,554 $165,338,677 $192,022,122 Argentina $64,693,793 $82,135,792 $99,904,793 $123,448,708 $122,971,344 $137,551,564 $118,878,421 $116,432,562 Costa Rica $14,346,918 $22,499,571 $28,347,436 $60,761,309 $71,472,489 $85,946,299 $104,786,557 $99,146,501 Chile $31,758,153 $30,257,935 $39,923,701 $57,930,394 $58,931,699 $54,867,012 $54,222,534 $57,190,674 Venezuela $157,169,382 $170,053,933 $189,685,123 $188,877,607 $211,036,334 $195,830,655 $86,254,885 $43,213,614 Dominican Rep $18,863,334 $26,450,210 $32,651,364 $41,483,425 $35,334,841 $39,445,435 $32,138,465 $41,333,277 El Salvador $1,617,850 $1,486,255 $825,162 $640,841 $608,725 $4,151,100 $16,721,232 $30,095,192 Colombia $7,269,747 $8,061,018 $9,243,386 $9,561,846 $16,283,367 $22,465,586 $19,744,917 $24,430,754 Peru $8,477,046 $10,494,814 $6,209,334 $7,649,498 $5,833,425 $9,035,534 $7,476,416 $14,772,089 Uruguay $5,725,041 $7,168,186 $2,196,811 $3,663,800 $3,567,225 $10,346,977 $8,336,313 $2,702,082 Suriname $56,534 $13,679 $81,036 $65,237 $575,918 $561,195 $973,801 $1,585,505 Panama $208,514 $293,584 $229,026 $238,425 $292,398 $339,132 $588,332 $1,017,823 Bolivia $452,253 $1,163,454 $350,645 $433,616 $812,044 $828,360 $776,600 $927,577 Jamaica $429,922 $665,920 $737,496 $1,064,957 $862,383 $1,120,626 $1,315,217 $799,397 Br Virgin Is $39,570 $67,704 $129,820 $8,822 $636,834 $698,786 $128,647 $716,160 Ecuador $258,367 $779,563 $818,710 $1,020,262 $885,811 $429,339 $584,590 $496,884 Trade

Property of Property of

HDMA The 2009HDMA Global Commercial Vehicle Report 45 Asia and the Pacific

2001 2002 2003 2004 2005 2006 2007 2008* Asia And

the Pacific $18,193,014,174 $19,485,187,823 $20,639,069,125 $24,562,867,206 $28,338,408,365 $30,603,692,221 $32,963,542,131 $34,392,280,455

Japan $12,889,408,329 $13,007,108,187 $13,109,509,334 $14,890,970,852 $15,885,282,774 $14,921,171,836 $14,506,681,225 $14,266,218,937 China $1,583,066,407 $2,106,200,407 $2,747,553,371 $3,943,736,321 $5,448,632,273 $7,152,253,336 $9,039,753,656 $9,745,880,037 Korea $1,001,087,101 $1,273,781,668 $1,455,509,737 $1,858,183,102 $2,703,324,204 $3,701,808,966 $3,926,942,239 $4,348,280,984 Taiwan $1,162,843,016 $1,368,211,203 $1,451,841,614 $1,700,595,341 $1,840,210,377 $1,937,986,307 $2,107,687,797 $2,245,392,891 Thailand $270,837,563 $328,249,831 $327,858,370 $390,342,525 $467,956,195 $637,763,739 $890,847,298 $1,135,377,690 Philippines $344,023,730 $328,476,563 $364,868,644 $393,912,704 $424,037,827 $505,721,673 $593,025,266 $658,408,120 India $165,092,557 $191,963,719 $212,525,529 $285,794,774 $369,906,923 $431,122,031 $493,484,401 $557,623,036 Indonesia $213,497,777 $224,070,822 $261,496,517 $286,607,159 $300,759,002 $456,586,495 $523,431,733 $492,826,693 Vietnam $506,954 $5,274,165 $15,927,321 $22,659,673 $33,516,285 $69,472,804 $115,209,773 $186,605,768 Israel $71,139,781 $77,732,676 $82,889,393 $85,182,676 $98,537,179 $105,679,480 $123,762,974 $164,763,951 Australia $174,135,491 $191,075,556 $203,101,829 $211,130,221 $162,726,349 $134,600,784 $134,310,342 $131,656,978 Malaysia $69,675,155 $92,498,809 $83,320,997 $83,725,062 $102,175,841 $134,582,559 $132,942,744 $103,084,182 Turkey $27,985,058 $31,397,233 $34,355,618 $65,120,104 $98,103,178 $111,459,119 $101,441,835 $99,160,883 Sri Lanka $41,441,606 $43,683,076 $48,379,146 $67,033,969 $82,046,898 $88,086,817 $92,286,720 $94,446,362 Hong Kong $41,916,638 $51,743,302 $57,288,606 $76,645,024 $80,998,801 $90,703,426 $70,254,401 $67,600,498 Singapore $80,859,637 $93,089,073 $93,570,613 $109,767,499 $143,914,679 $95,770,281 $84,815,378 $65,605,698 United Arab Em $1,612,035 $2,295,050 $1,799,473 $3,189,105 $5,667,277 $5,312,668 $6,895,722 $8,885,943 Saudi Arabia $424,007 $1,072,418 $2,516,250 $536,658 $663,247 $1,898,138 $2,461,295 $7,359,754 New Zealand $51,374,835 $64,841,608 $80,803,646 $82,975,460 $82,805,592 $12,673,816 $4,433,905 $4,076,036 Pakistan $799,589 $628,441 $659,689 $815,556 $1,178,473 $2,669,170 $7,127,146 $3,646,714 Trade

Europe

2001 2002 2003 2004 2005 2006 2007 2008*

Europe $7,264,014,308 $8,165,683,021 $9,461,483,885 $10,216,764,006 $10,880,085,130 $10,805,285,262 $12,041,808,602 $12,148,666,504

Germany $3,244,746,367 $3,710,726,005 $4,495,213,896 $4,972,152,126 $5,155,047,180 $5,129,351,176 $6,233,834,768 $6,347,908,545 France $1,197,957,841 $1,234,214,325 $1,350,490,160 $1,524,438,645 $1,538,309,809 $1,444,175,591 $1,364,561,007 $1,370,720,807 United Kingdom $972,074,977 $1,102,409,081 $1,073,147,051 $1,051,861,570 $1,126,430,768 $1,065,505,705 $1,113,967,250 $1,123,303,212 Italy $460,507,851 $547,414,606 $628,621,343 $710,367,692 $713,786,820 $699,528,597 $691,861,457 $817,324,475 Spain $341,931,418 $395,401,900 $453,297,674 $491,455,922 $552,800,613 $566,235,976 $493,676,950 $426,860,569 Czech Republic $63,841,838 $80,642,026 $104,464,262 $112,900,662 $164,832,947 $165,363,340 $275,619,509 $347,835,537 Austria $182,745,574 $187,251,543 $240,140,016 $192,925,397 $322,726,094 $306,998,980 $480,948,455 $225,316,763 Hungary $93,774,154 $171,736,148 $301,019,678 $203,598,238 $193,540,306 $197,548,193 $180,629,287 $204,323,088 Sweden $132,350,052 $146,127,381 $139,285,802 $161,098,263 $205,977,724 $221,080,360 $155,860,496 $175,741,268 Belgium $94,498,087 $92,764,334 $92,067,500 $95,423,768 $137,762,344 $172,271,792 $167,229,312 $136,425,815 Romania $6,875,590 $15,135,599 $37,541,777 $55,920,563 $56,345,016 $64,747,257 $106,222,689 $129,890,154 Portugal $48,659,881 $60,157,605 $57,730,568 $105,825,736 $128,407,135 $117,927,530 $108,395,162 $124,611,141 Switzerland $49,765,917 $45,947,968 $47,550,352 $47,386,992 $62,360,808 $69,306,297 $106,760,177 $116,078,495 Netherlands $55,686,510 $61,018,316 $60,272,951 $64,548,505 $73,161,769 $79,727,153 $74,329,942 $101,035,387 Poland $42,983,035 $46,216,407 $77,855,729 $75,193,322 $65,343,716 $88,350,593 $115,968,807 $91,880,557 Liechtenstein Property$124,207,006 $136,099,471 $149,187,917 $159,996,750 of $141,206,665 $120,265,422 $110,934,004 $75,904,162 Ukraine $264,312 $340,598 $940,024 $4,856,989 $9,150,122 $27,735,644 $38,200,981 $69,282,073 Finland $25,842,794 $27,404,144 $33,854,869 $44,712,573 $56,610,387 $63,491,840 $49,580,177 $52,981,740 Slovak Republic $28,976,745 $20,246,984 $22,606,506 $31,155,047 $40,416,223 $38,493,823 $35,051,304 $36,226,440 Russia $589,273 $882,010 $1,694,963 $2,476,608 $1,975,646 $3,838,048 $13,489,748 $28,644,525

46 The 2009 Global CommerHDMAcial Vehicle Report Motor Vehicle Parts Trade Balance likely related to the supply of German brand vehicle manufacturers, The motor vehicle parts trade deficit is forecast to fall by $1.78 bil- such as BMW and Mercedes-Benz, which have set up factories in the lion in 2008. In the last four years, including 2008, there has been United States. With Chrysler no longer owned by German Daimler, a pattern emerging where the trade deficit rises one year only to fall however, the deficit to Germany may decrease. While limited parts the next. The total parts trade deficit for 2008 is forecasted to be commonalities were achieved with Chrysler products during the $33.25 billion. time of ownership, there were some sourcing partnerships. With the relationship dissolved, the introduction of new Chrysler vehicles Even though the growth of Chinese parts exports and the volume could bring a reduction in German parts imported. of Mexican made products are the most noteworthy import part newsmakers, it is Japan that remains the single largest contributor nation to the parts trade deficit. With a trade gap of -$12.7 billion, Japan accounts for over one third of the entire imbalance. The 2008 U.S Motor Vehicle Parts Trade Balance millions of dollars deficit with Japan is down almost 14% from the 2005 high of $14.75 billion.

Along with Japan, in line with from the volume of imports, Mexico contributes just about one third of the total trade deficit. Unlike Japan, however, Mexican trade deficit is rising rapidly. Since 2001, the trade gap has increased by $8.4 billion, or 460%.

Leader in the efforts to lower the trade gap is Canada, which reports a $13.6 billion in parts trade surplus from the U.S. The surplus with Canada is also trending upwards, however, even as America’s largest trading partner, it is unable to make up for the deficits with many other nations.

Trade with Europe has been contribution ever greater amounts to * HDMA forecast the deficit. Since 2001, parts trade with Europe has gone from -$2.2 Source: U.S. Department of Commerce, United States International Trade Commission, Trade DataWeb billion to -$7.1 billion. More than half the gap is from Germany,

Africa and Antarctica

2001 2002 2003 2004 2005 2006 2007 2008* Trade Africa and Antarctica $50,374,267 -$47,308,274 -$41,294,881 -$51,888,094 -$99,818,176 -$70,926,062 -$75,909,426 -$15,447,655

Egypt $30,500,675 $24,698,814 $43,708,000 $46,329,662 $57,296,915 $59,468,615 $49,840,301 $46,321,012 Algeria $7,458,261 $3,457,700 $6,481,840 $2,745,798 $5,575,610 $16,036,353 $13,943,882 $14,342,422 Angola $1,050,274 $1,122,833 $1,813,518 $1,648,625 $2,195,419 $7,005,715 $11,415,474 $9,770,554 Ghana $2,807,840 $1,877,319 $2,901,324 $2,336,224 $2,956,030 $2,613,646 $5,259,232 $3,359,442 Kenya $1,145,795 $1,080,128 $1,344,130 $1,088,331 $554,544 $1,311,602 $2,167,337 $3,082,663 Guyana $2,714,242 $2,881,392 $1,959,778 $2,651,926 $2,376,162 $2,600,315 $2,135,969 $2,450,641 Zambia $246,265 $255,841 $95,025 $205,117 $398,329 $2,002,799 $2,478,477 $2,131,890 Tanzania $797,052 $917,964 $651,216 $971,800 $1,338,856 $1,196,864 $4,847,789 $2,018,674 Niger $2,579,173 $383,925 $389,770 $238,208 $331,134 $975,969 $1,504,849 $1,718,398 Morocco $1,529,633 $1,522,657 -$1,015,519 -$3,583,372 -$9,710,579 -$12,630,693 -$15,683,953 -$17,807,745 South Africa -$195,492,995 -$104,190,904 -$118,855,818 -$120,770,586 -$181,445,174 -$197,066,184 -$214,342,381 -$138,242,592 Property of Property of

HDMA The HDMA2009 Global Commercial Vehicle Report 47 Americas

2001 2002 2003 2004 2005 2006 2007 2008*

Americas $7,200,367,957 $3,729,903,869 -$322,188,313 -$1,092,442,298 -$3,079,905,038 -$1,144,667,258 -$312,617,483 $2,440,006,042

Canada $9,796,519,816 $9,743,270,443 $7,956,981,169 $8,548,577,229 $8,192,154,655 $9,977,977,670 $11,412,871,709 $13,638,492,307 Venezuela $389,392,368 $93,828,366 -$48,725,219 $138,767,263 $211,675,381 $340,988,187 $491,534,361 $508,213,976 Chile $48,919,866 $76,808,495 $65,084,219 $59,642,368 $87,373,359 $127,535,540 $188,836,332 $182,715,134 Argentina $69,400,130 -$39,676,703 $16,851,134 $13,758,188 $41,623,061 $55,704,205 $113,194,564 $119,444,338 Colombia $55,727,966 $60,420,347 $52,559,116 $80,040,779 $86,542,932 $95,397,462 $112,984,045 $114,093,502 Peru $21,055,353 $20,881,503 $27,233,731 $24,724,728 $48,026,817 $47,102,441 $70,575,390 $65,584,431 Dominican Rep $51,309,455 $52,163,880 $28,209,796 $4,431,310 $10,109,067 $22,318,739 $48,961,744 $48,515,213 Ecuador $53,913,628 $37,801,907 $38,048,755 $43,773,635 $45,107,168 $41,793,904 $43,705,417 $44,506,702 Panama $20,690,192 $13,529,509 $16,862,161 $16,347,832 $18,423,503 $24,873,663 $35,057,294 $34,025,749 Jamaica $12,651,947 $12,847,216 $10,111,736 $11,582,267 $12,664,172 $16,538,626 $24,716,116 $26,227,419 El Salvador $12,883,448 $11,258,703 $13,537,111 $12,551,499 $10,932,773 $14,171,851 $9,479,383 -$3,567,640 Costa Rica $19,114,659 $12,071,364 $3,730,148 -$34,496,281 -$39,655,263 -$43,550,609 -$49,014,185 -$37,929,377 Honduras -$24,266,351 -$41,526,404 -$65,289,792 -$85,974,042 -$154,356,447 -$224,978,118 -$217,936,587 -$172,136,457 Nicaragua $8,086,750 $3,408,522 -$30,931,271 -$55,470,303 -$102,391,755 -$117,934,272 -$150,993,511 -$179,078,468 Brazil -$189,141,328 -$327,668,944 -$400,591,413 -$542,212,840 -$757,113,379 -$770,726,350 -$592,933,702 -$547,494,081 Mexico -$3,237,956,961 -$6,080,314,991 -$8,085,852,245 -$9,432,193,750 -$10,919,132,553 -$10,939,455,577 -$12,106,360,213 -$11,669,266,483 Trade

Property of

48 The 2009 Global CommerHDMAcial Vehicle Report Asia and the Pacific

2001 2002 2003 2004 2005 2006 2007 2008* Asia And

the Pacific -$14,299,242,044 -$15,339,659,446 -$16,496,531,718 -$20,472,997,066 -$24,140,936,669 -$25,760,763,274 -$27,601,583,703 -$29,007,925,377

Australia $381,391,521 $387,989,962 $441,917,598 $560,183,974 $598,406,121 $656,126,247 $636,418,459 $642,265,185 Saudi Arabia $165,738,919 $150,813,950 $152,325,622 $170,504,059 $164,358,883 $208,192,872 $219,061,195 $210,212,727 Singapore $37,938,500 $36,357,926 $44,123,614 $43,364,701 $14,859,461 $113,266,943 $152,588,941 $167,164,851 United Arab Em $42,847,289 $58,164,013 $68,272,471 $86,052,893 $83,272,167 $120,652,554 $166,696,987 $154,667,650 Hong Kong $70,883,295 $21,237,266 $32,822,024 $25,395,770 $28,130,384 $7,944,187 $48,131,554 $43,654,955 New Zealand -$34,887,419 -$45,368,566 -$64,116,390 -$57,328,217 -$53,632,464 $20,468,930 $35,035,284 $36,594,419 Pakistan $1,412,356 $1,307,544 $2,406,131 $2,440,747 $2,176,666 $2,272,424 $2,171,262 $3,000,234 Turkey -$10,272,346 -$14,319,586 -$20,600,711 -$43,514,810 -$62,430,671 -$70,917,748 -$50,462,676 -$54,995,740 Malaysia -$30,757,994 -$63,861,573 -$51,558,569 -$61,964,262 -$61,175,817 -$105,778,745 -$108,464,415 -$78,752,385 Israel -$15,834,258 -$23,386,655 -$39,449,713 -$42,097,581 -$58,550,159 -$60,896,136 -$81,218,316 -$123,267,973 Vietnam $5,668,566 -$667,991 -$7,420,805 -$13,663,366 -$20,718,644 -$65,878,283 -$108,797,488 -$182,044,847 Indonesia -$195,715,867 -$202,639,097 -$239,084,043 -$252,468,724 -$268,736,620 -$419,885,239 -$476,981,326 -$441,498,995 India -$134,417,534 -$169,724,562 -$183,615,918 -$239,397,523 -$327,638,133 -$363,663,902 -$408,559,398 -$471,889,398 Philippines -$306,495,163 -$268,301,193 -$278,805,610 -$321,004,955 -$315,006,038 -$390,628,775 -$478,108,856 -$528,150,767 Thailand -$188,139,725 -$245,560,910 -$232,373,777 -$292,203,151 -$369,422,415 -$556,402,060 -$777,547,987 -$1,029,719,957 Taiwan -$1,076,995,613 -$1,286,073,192 -$1,324,797,075 -$1,598,899,822 -$1,738,728,603 -$1,817,896,913 -$2,026,132,932 -$2,168,078,814 Korea -$662,175,431 -$992,542,211 -$1,181,358,162 -$1,432,745,409 -$2,199,021,033 -$3,177,153,752 -$3,407,699,953 -$3,877,952,595 China -$1,318,893,115 -$1,771,104,251 -$2,273,835,273 -$3,367,285,595 -$4,840,582,098 -$6,401,354,630 -$8,025,493,068 -$8,696,145,928 Japan -$11,067,382,936 -$10,947,989,447 -$11,385,294,319 -$13,683,671,225 -$14,754,619,384 -$13,514,064,653 -$13,031,922,828 -$12,707,111,825

Europe Trade 2001 2002 2003 2004 2005 2006 2007 2008* Europe -$2,291,911,291 -$3,527,394,611 -$5,176,040,017 -$5,863,630,425 -$5,986,720,621 -$5,614,502,222 -$7,036,754,760 -$7,077,350,552

Austria $893,231,191 $723,675,200 $277,514,716 $254,053,809 $418,514,522 $506,698,273 $85,687,714 $397,956,574 Belgium $246,555,546 $286,720,519 $256,753,761 $210,489,889 $129,309,540 $165,012,666 $212,129,116 $258,953,138 Netherlands $277,655,501 $262,274,510 $256,869,848 $255,762,842 $274,401,616 $314,685,973 $282,469,229 $255,071,010 Russia $19,486,128 $15,095,160 $21,144,155 $24,216,157 $36,983,677 $110,169,475 $122,658,261 $130,864,821 Sweden -$27,849,388 $3,570,996 $74,954,821 $95,144,633 $13,518,163 -$3,491,430 $77,256,197 $59,454,187 Finland -$11,719,813 -$16,066,753 -$13,133,719 -$18,733,829 -$33,491,197 -$30,961,208 -$8,681,487 -$11,543,426 Poland -$33,486,086 -$32,540,646 -$61,285,187 -$58,367,708 -$39,191,020 -$43,903,544 -$58,904,835 -$33,070,966 Slovak Republic -$28,301,137 -$18,933,758 -$19,955,781 -$26,503,674 -$37,432,272 -$35,521,432 -$32,322,480 -$33,097,162 Switzerland $113,675,867 $192,253,282 $150,794,311 $171,183,731 $183,392,860 $54,660,775 -$36,459,287 -$59,696,332 Ukraine $1,515,238 $1,572,841 $3,324,392 $424,681 -$5,933,839 -$18,623,140 -$28,390,227 -$62,018,170 Portugal $7,930,254 -$33,456,359 -$33,100,611 -$86,757,157 -$112,493,294 -$105,331,224 -$86,363,362 -$103,231,909 Romania -$6,148,288 -$11,672,812 -$26,570,181 -$36,324,074 -$43,694,491 -$57,220,493 -$102,619,732 -$125,039,328 Hungary -$74,309,587 -$118,520,393 -$234,537,402 -$142,975,988 -$145,922,351 -$135,151,870 -$115,992,976 -$140,198,081 Spain -$251,014,872 -$295,340,608 -$328,605,777 -$371,173,666 -$309,059,485 -$325,602,582 -$271,970,688 -$208,511,048 Czech Republic -$56,074,304 -$71,691,999 -$96,201,710 -$106,989,709 -$152,988,844 -$152,484,999 -$255,247,969 -$328,565,363 Property of United Kingdom Property$122,823,703 -$125,345,252 -$126,533,454 -$205,491,089 of -$432,151,234 -$384,806,606 -$401,888,285 -$414,467,327 Italy -$327,415,774 -$425,124,367 -$483,338,444 -$576,187,052 -$582,953,525 -$560,122,737 -$536,493,160 -$659,737,384 France -$793,100,719 -$920,344,511 -$1,021,370,362 -$1,125,057,037 -$1,023,369,362 -$893,557,511 -$761,059,994 -$769,769,742 Germany -$2,240,684,433 -$2,844,741,820 -$3,671,440,640 -$3,996,231,776 -$4,031,540,224 -$3,882,008,736 -$5,057,003,049 -$5,154,465,475

HDMA The 2009HDMA Global Commercial Vehicle Report 49 US Motor Vehicle Industry Data

The U.S. Census Bureau conducts the economic census every five The total value of shipments produced within the U.S. motor ve- years, in years ending in a 2 or 7. Data is collected in the interim hicle industry slipped 1.8% in 2005 to settle at $490.2 billion. De- years via the Bureau’s Annual Survey of Manufacturers (ASM). The creases were evident across all segments, the largest coming in parts ASM is based on the sample framework of the Economic Census – manufacturing which registered a 3.9% fallback to $198.2 billion. Manufacturing. As 2002 was the last US census year, 2005 data, the On average, the motor vehicle industry in 2005 produced $166,798 most recent data available, is based on the ASM. in value added per employee, a slight 0.2% rise compared to 2004. Employment in the U.S. motor vehicle manufacturing industry Motor vehicle manufacturing recorded significantly higher levels increased slightly in 2005, reaching 966,366 workers (+0.2%). than other sectors, with its $331,295 per employee nearly doubling Production workers accounted for 80.0% of the total automotive the industry average. Total value of shipments per employee fell workforce. The largest sector, motor vehicle parts manufacturing, 2.0 % from 2004 to 2005, coming in at $507,213. Again, vehicle employed 612,873 people or 63.4% of the total. manufacturing dominated in this aspect, nearly quadrupling the closest segment, parts production. Overall, manufacturing value Total motor vehicle industry payroll in 2005 remained stable, inch- added made up 32.9% of 2005 total shipment value, up from 32.2% ing up 0.3% from the year prior to settle at $49.6 billion. In general, the year before. employees in motor vehicle manufacturing tend to earn more than those in other sectors, accounting for 28.7% of the total payroll and The average hourly earnings of production workers remained at con- only 21.1% of the total number of employees. sistent levels from 2004 to 2005, inching up 0.3% to $23.68. This is in line with the similar rise in value added per employee, the affect U S M o t or Vehi c le I nd u s ry D a Manufacturer value added edged up from $160.6 billion in 2004 to being no year-over-year change in production wages as a proportion $161.2 billion in 2005. Significant positive growth in value added of value added – 23.2%. Production worker hourly wages are highest was only seen in motor vehicle manufacturing (+1.3%). Body and among employees of vehicle manufacturing ($34.02), followed by trailer production (0.0%) remained at par while parts manufacturing parts ($21.82) and body and trailer ($15.90) production. (-0.4%) saw value added dip slightly. In accordance, year-over-year capital expenditure increases were only seen in the motor vehicle manufacturing sector, with a rise of 4.6% to $4.3 billion.

Employment Data Annual Survey of Manufacturers All Employees Production Workers NAICS P payroll hours Wages CODE Number ($000) number (000) ($000) 3361 Motor Vehicle Manufacturing 204,065 14,231,237 176,346 354,803 12,069,111 336111 Automobile Manufacturing 71,479 5,353,182 60,819 124,406 4,502,483 336112 Light Truck and Utility Vehicle Manufacturing 99,568 7,432,378 88,724 183,454 6,517,139 336120 Heavy Duty Truck Manufacturing 33,018 1,445,677 26,803 46,943 1,049,489

t 3362 Motor Vehicle Body and Trailer Manufacturing 149,428 5,280,917 118,486 234,972 3,735,679 a 336211 Motor Vehicle Body Manufacturing 48,396 1,807,769 36,344 72,823 1,199,069 336212 Truck Trailer Manufacturing 30,016 1,014,704 24,888 50,428 770,910 336213 Motor Home Manufacturing 22,059 777,865 17,965 33,547 552,086 336214 Travel Trailer and Camper Manufacturing 48,957 1,680,579 39,289 78,174 1,213,614

3363 Motor Vehicle Parts Manufacturing 612,873 30,040,188 478,679 987,766 21,552,379 33631 Gasoline Engine and Engine Parts Manufacturing 73,016 4,223,110 56,589 120,731 3,096,566 33632 Electrical and Electronic Equipment Manufacturing 80,892 3,566,419 58,317 116,662 2,150,513 336330 Steering & Suspension Components (except Spring) 37,399 1,857,880 29,583 59,014 1,341,599 336340 Brake System Manufacturing 37,198 1,524,768 28,675 59,251 1,018,321 335350 Transmission & Power Train Parts Manufacturing 80,494 5,200,870 66,210 147,312 4,121,431 336360 SeatingProperty & Interior Trim Manufacturing 47,106 of1,975,503 34,304 66,063 1,268,654 336370 Motor Vehicle Stamping 99,365 5,461,140 81,004 170,906 4,274,659 336391 Motor Vehicle Air-Conditioning Manufacturing 17,011 822,909 13,107 26,370 568,714 336399 All Other Motor Vehicle Part Manufacturing 140,392 5,407,589 110,890 221,457 3,711,922 Total U.S. Auto Industry 966,366 49,552,342 773,511 1,577,541 37,357,169

Source: U.S. Census Bureau and U.S. Department of Commerce 50 The 2009 Global CommerHDMAcial Vehicle Report Manufacturing Data Annual Survey of Manufacturers

($000) NAICs Value added by Cost of Value of Total capital CODE manufacture materials shipments expenditures

3361 Motor Vehicle Manufacturing 67,605,759 194,435,553 259,449,261 4,283,061 336111 Automobile Manufacturing 24,517,958 63,817,188 86,778,640 2,541,981 336112 Light Truck and Utility Vehicle Manufacturing 39,200,693 108,615,417 147,463,247 1,544,154 336120 Heavy Duty Truck Manufacturing 3,887,108 22,002,948 25,207,374 196,926

3362 Motor Vehicle Body and Trailer Manufacturing 12,292,508 21,403,421 32,493,277 391,167 336211 Motor Vehicle Body Manufacturing 4,411,842 6,490,485 10,237,275 149,836 336212 Truck Trailer Manufacturing 2,291,959 4,898,765 6,915,888 108,168 336213 Motor Home Manufacturing 2,138,264 4,124,442 6,109,655 53,262 336214 Travel Trailer and Camper Manufacturing 3,450,443 5,889,729 9,230,459 79,901 a 3363 Motor Vehicle Parts Manufacturing 81,289,767 125,157,004 198,211,020 6,759,388 t 33631 Gasoline Engine and Engine Parts Manufacturing 13,918,889 21,271,073 34,431,273 1,428,428 33632 Electrical and Electronic Equipment Manufacturing 10,000,102 12,422,295 19,928,496 715,593 336330 Steering & Suspension Components (except Spring) 4,331,640 6,486,497 10,586,622 334,317 336340 Brake System Manufacturing 5,277,446 8,239,542 12,388,807 360,423 335350 Transmission & Power Train Parts Manufacturing 14,169,532 20,844,233 34,266,112 1,367,138 336360 Seating & Interior Trim Manufacturing 4,335,304 13,699,517 17,796,096 276,847 336370 Motor Vehicle Stamping 12,065,687 14,758,641 25,729,385 946,200 336391 Motor Vehicle Air-Conditioning Manufacturing 2,092,620 3,708,437 5,184,068 132,318 336399 All Other Motor Vehicle Part Manufacturing 15,098,547 23,726,769 37,900,161 1,198,124 Total U.S. Auto Industry 161,188,034 340,995,978 490,153,558 11,433,616

Source: U.S. Census Bureau and U.S. Department of Commerce ry D a U S M o t or Vehi c le I nd u s ry

Property of Property of

HDMA The 2009HDMA Global Commercial Vehicle Report 51 Value Added Annual Survey of Manufacturers

Value of Value Value Value Added shipments per Value NAICS A added added per per Production employee added per Dollar CODE per Employee production Worker Worker Hour Paid (all employees) of Shipments %

3361 Motor Vehicle Manufacturing $331,295 $383,370 $191 $1,271,405 26.1% 336111 Automobile Manufacturing $343,009 $403,130 $197 $1,214,044 28.3% 336112 Light Truck and Utility Vehicle Manufacturing $393,708 $441,827 $214 $1,481,031 26.6% 336120 Heavy Duty Truck Manufacturing $117,727 $145,025 $83 $763,443 15.4%

3362 Motor Vehicle Body and Trailer Manufacturing $82,264 $103,747 $52 $217,451 37.8% 336211 Motor Vehicle Body Manufacturing $91,161 $121,391 $61 $211,531 43.1% 336212 Truck Trailer Manufacturing $76,358 $92,091 $45 $230,407 33.1% 336213 Motor Home Manufacturing $96,934 $119,024 $64 $276,969 35.0% 336214 Travel Trailer and Camper Manufacturing $70,479 $87,822 $44 $188,542 37.4% U S M o t or Vehi c le I nd u s ry D a

3363 Motor Vehicle Parts Manufacturing $132,637 $169,821 $82 $323,413 41.0% 33631 Gasoline Engine and Engine Parts Manufacturing $190,628 $245,965 $115 $471,558 40.4% 33632 Electrical and Electronic Equipment Manufacturing $123,623 $171,478 $86 $246,359 50.2% 336330 Steering & Suspension Components (except Spring) $115,822 $146,423 $73 $283,072 40.9% 336340 Brake System Manufacturing $141,874 $184,043 $89 $333,050 42.6% 335350 Transmission & Power Train Parts Manufacturing $176,032 $214,009 $96 $425,698 41.4% 336360 Seating & Interior Trim Manufacturing $92,033 $126,379 $66 $377,788 24.4% 336370 Motor Vehicle Stamping $121,428 $148,952 $71 $258,938 46.9% 336391 Motor Vehicle Air-Conditioning Manufacturing $123,016 $159,657 $79 $304,748 40.4% 336399 All Other Motor Vehicle Part Manufacturing $107,546 $136,158 $68 $269,960 39.8% Total U.S. Auto Industry $166,798 $208,385 $102 $507,213 32.9%

Source: U.S. Census Bureau and U.S. Department of Commerce t a

Property of

52 The 2009 Global CommerHDMAcial Vehicle Report Productivity Ratios Annual Survey of Manufacturers

production Workers Production Wages production Wages average Hourly production as a % of NAICs as a % as a % earnings of Wages Total CODE of Value Added shipments production Workers per Worker employment

3361 Motor Vehicle Manufacturing 17.9% 4.7% $34.02 $68,440 86.4% 336111 Automobile Manufacturing 18.4% 5.2% $36.19 $74,031 85.1% 336112 Light Truck and Utility Vehicle Manufacturing 16.6% 4.4% $35.52 $73,454 89.1% 336120 Heavy Duty Truck Manufacturing 27.0% 4.2% $22.36 $39,156 81.2%

3362 Motor Vehicle Body and Trailer Manufacturing 30.4% 11.5% $15.90 $31,528 79.3% 336211 Motor Vehicle Body Manufacturing 27.2% 11.7% $16.47 $32,992 75.1% 336212 Truck Trailer Manufacturing 33.6% 11.1% $15.29 $30,975 82.9% 336213 Motor Home Manufacturing 25.8% 9.0% $16.46 $30,731 81.4% 336214 Travel Trailer and Camper Manufacturing 35.2% 13.1% $15.52 $30,889 80.3%

3363 Motor Vehicle Parts Manufacturing 26.5% 10.9% $21.82 $45,025 78.1% a 33631 Gasoline Engine and Engine Parts Manufacturing 22.2% 9.0% $25.65 $54,720 77.5% t 33632 Electrical and Electronic Equipment Manufacturing 21.5% 10.8% $18.43 $36,876 72.1% 336330 Steering & Suspension Components (except Spring) 31.0% 12.7% $22.73 $45,350 79.1% 336340 Brake System Manufacturing 19.3% 8.2% $17.19 $35,513 77.1% 335350 Transmission & Power Train Parts Manufacturing 29.1% 12.0% $27.98 $62,248 82.3% 336360 Seating & Interior Trim Manufacturing 29.3% 7.1% $19.20 $36,983 72.8% 336370 Motor Vehicle Stamping 35.4% 16.6% $25.01 $52,771 81.5% 336391 Motor Vehicle Air-Conditioning Manufacturing 27.2% 11.0% $21.57 $43,390 77.1% 336399 All Other Motor Vehicle Part Manufacturing 24.6% 9.8% $16.76 $33,474 79.0% Total U.S. Auto Industry 23.2% 7.6% $23.68 $48,296 80.0%

Source: U.S. Census Bureau and U.S. Department of Commerce ry D a U S M o t or Vehi c le I nd u s ry

Property of Property of

HDMA The 2009HDMA Global Commercial Vehicle Report 53 U.S. Transportation Impact and Infrastructure

U.S. Transportation System Ton Miles per Year by Mode, Cumulative For hire transportation represented 3.2% of the U.S. total GDP in Billions of ton miles 2006 based on data from the United States Department of Transpor- Air freight omitted due to scale. Contribution of air freight is ap- tation (DOT) Administration Research and Innovative Technology proximately one third of one percent (RITA) Administration, Bureau of Transportation Statistics (BTS) Transportation Statistics 2008. 3.2% of the 2006 GDP is $366.2 billion.

Within the $366.2 billion GDP, the largest sector by far is truck transportation. With a 28.3% share of all for-hire transportation GDP dollars, truck transportation was valued at $103.5 billion dollars in 2006. Growth in trucking GDP slowed to 2.07% when comparing 2006 to 2005, trailing the transportation sector growth of 5.23%t.

GDP Share of Transportation Sector 2006

Source: United States Department of Transportation (DOT) Administration Re- N or search and Innovative Technology (RITA) Administration, Bureau of Transporta- tion Statistics (BTS) Transportation Statistics 2008 t h A meri c an I nd u s ry

by rail by more than three-to-one. Border crossings with Mexico, trucks hold nearly a six-to-one advantage. All told, in 2007, border crossing points with Canada and Mexico counted 11.4 million trucks. The value of the export portion of these crossings is estimated at $267 billion. When total 2007 export value to Canada and Mexico is estimated at $345 billion, the over 75% share controlled by trucking underscores the important international trade role played by an industry which is most commonly considered a Source: United States Department of Transportation (DOT) Administration Re- domestic enterprise. search and Innovative Technology (RITA) Administration, Bureau of Transporta- tion Statistics (BTS) Transportation Statistics 2008

In ton-miles, trucking now trails only railroads, having surpassed Truck Border Crossings, 2002-2006 pipeline shipments almost 15 years ago. Along with a 28.3% GDP share, trucking accounts for a very comparable 28.5% of ton-miles. Railroads, by contrast, control 38.2% of ton-miles, yet account for a much smaller nine percent of transportation GDP. Railroads have the advantage in the carriage of exceptionally heavy loads over long distances, with few stops. These characteristics, when compared to trucking which has a greater variety of loads and distances, provide railroads an impressive ton-mile total.

The economic impact of trucking goes beyond the United States borders. While the popular image of export involves giant container ships being loaded in America’s harbors, the role of the truck is not limited to delivery of those containers to port. Trucks play an essential and dominating roll in the export of products to America’s two largest tradingProperty partners – Canada and Mexico. of Annual U.S. Canada border crossings by truck outnumber those Source: United States Department of Transportation (DOT) Administration Re- search and Innovative Technology (RITA) Administration, Bureau of Transporta- tion Statistics (BTS) Transportation Statistics 2008

54 The 2009 Global CommerHDMAcial Vehicle Report Export Values to Canada The DOT reported 4,016,741 miles of road in 2006. This is an increase of 21,106 miles, or 0.53%, compared to 2005. In the last five years, total road miles have grown by just 1.73%, while the past decade has seen growth of just 2.48%. By comparison, total vehicle travel grew by 7.81% in the same five year span, and 21.43% from 1997 through 2006. Infrastructure is clearly not keeping pace with traffic demand.

The news is only slightly better when the comparison is made on the basis of lane miles. The layout of the U.S. road system is mostly complete, and completely new roads may not be needed in many cases. Augmenting existing roads to handle increased road traffic is often the best solution. Furthermore, new roads may be built multi- lane in anticipation of future needs. Lane miles grew by 48,871 in 2006, or .58%. The five and ten year increase levels were 2.04 and 2.96%, respectively; above the roadway miles, but still far below the Export Values to Mexico increase in traffic volume during the same time period.

The lack of growth in road infrastructure its impact on heavy duty vehicle industries can be underscored and quantified through a comparison of Interstate motor carriers per unit of road way. The Federal Motor Carrier Safety Administration records Interstate motor carriers, and for 2005 reported 679,744 in operation. This is an increase of over 300,000 from 1996 levels or about 80%. Clearly this far exceeds the rate of road infrastructure growth.

A method of simplifying this relationship is to state the number of Interstate motor carriers per 1000 miles of roadway. In 1995, there were 88 carriers per 1000 miles, and in 2000 142. By 2003, the ratio had reached 170 carriers per 1000 miles, the same level as the most Source: United States Department of Transportation (DOT) Administration Re- recently reported data, 2005. With 2 years of no growth, the pos- search and Innovative Technology (RITA) Administration, Bureau of Transporta- sibility of a saturation of existing infrastructure is a possibility. tion Statistics (BTS) Transportation Statistics 2008 The concern for quantity of roads is joined by a need for quality. DOT data grading the quality of America’s roads on the Internation- Highway Infrastructure and Congestion al Roughness Indicator (IRI) has shown a slow, but steady increase No roads means no trucks. That statement may be an oversimplifi- in overall quality. Perhaps most importantly for trucking, the DOT cation that ignores the large and healthy off-highway truck segment, has decreased the number of Interstates and other major expressways however, for the majority of trucking enterprises, it remains true. rated poor (the worst category) significantly in the last ten years. Unfortunately, it appears that this effort has allowed maintenance of The national road infrastructure is of critical importance to the t h A meri c an I nd u s ry trucking industry, and with significant investment made by users small roads to fall, compromising their condition. through payment of diesel taxes (see section 4 for more details),

heavy duty industries have an undeniable interest in the nation’s N or highway systems.

Percent of Roads Rated Poor on IRI Scale

RURAL 1996 2006 URBAN 1996 2006

Interstates 3.9 1 Interstates 8.6 2.4 Other principal arterials 1.4 1.7 Other freeways and expressway 3.4 2.9 Minor arterials 2.3 3.3 Other principal arterials 11.8 17.5 Property of Major collectorsProperty 6.7 6.2 Minorof arterials 6.9 12.2 Collectors 9.7 18.8

HDMA The 2009HDMA Global Commercial Vehicle Report 55 Also of concern, as the previous page table shows, is the difference diocre (second worst) while 19% of urban roads are so graded. The in quality between urban and rural roads; a difference that continues highest grade, very good, is awarded to 30.7% of rural Interstates, to widen. Rural road quality is better in every category, when mea- but only 18.7% of urban ones. In light of increasing urbanization, sured by percent listed as poor. For Interstates, the gap is evident in this is a troubling trend. all quality levels. Nine percent of rural Interstates are listed as me-

Annual New U.S. Road Mileage Interstate Motor Carriers per 1000 Miles of Highway

Source: United States Department of Transportation (DOT) Administration Re- search and Innovative Technology (RITA) Administration, Bureau of Transporta-

N or Source: United States Department of Transportation (DOT) Administration Re- tion Statistics (BTS) Transportation Statistics 2008 search and Innovative Technology (RITA) Administration, Bureau of Transporta- tion Statistics (BTS) Transportation Statistics 2008 t h A meri c an I nd u s ry Quality of Rural Road Surfaces by Quality of Urban Road Surfaces by Functional System Functional System International Roughness Indicator quality grades International Roughness Indicator quality grades

Source: United States Department of Transportation (DOT) Administration Re- Source: United States Department of Transportation (DOT) Administration Re- search and Innovative Technology (RITA) Administration, Bureau of Transporta- search and Innovative Technology (RITA) Administration, Bureau of Transporta- tion Statistics (BTS) Transportation Statistics 2008 tion Statistics (BTS) Transportation Statistics 2008 Property of

56 The 2009 Global CommerHDMAcial Vehicle Report Traffic Congestion urban areas (500,000 to one million residents) and small urban areas The most immediate impact deficiency of road infrastructure com- (population under 500,000) reported averages of $206 million and pared to vehicle travel is congestion. In fact, due to the daily ebb $56 million respectively. and flow of traffic volume, crashes and road maintenance, a highway infrastructure capable handling all situations without congestion is not a realistic expectation. Annual Costs of Congestion From 75 Metropolitan Areas While a 100% solution is unattainable, the impact of congestion re- (billions of constant (2002) dollars) mains. The International Road Transport Union (based in Europe) The cost of congestion is estimated with a value for each hour of estimates that fifty percent of annual fuel use is attributable to traffic travel time and each gallon of fuel congestion. For 2006, the Texas Transportation Institute reports the economic impact of congestion in 75 metro areas to have reached $73.846 billion (2002 dollars). That amounts to $250 per United States resident. Traffic congestion amounts to a $1000 per year cost to the average American family of four. The cost of congestion is estimated with a value for each hour of travel time and each gallon of fuel.

Not surprisingly, the biggest cities have the largest economic impact due to congestion. Leading the list is Los Angeles, which based on DOT data, had $9324 million lost due to congestion in 2005. Second is New York City, with a total of $7383 million, followed by Chicago at $3968 million. The very large city average, those areas with populations over three million, was $3205 million in 2005. Large urban areas, those with between one and three million residents, logged an average congestion loss of $628 million. Medium Source: Texas Transportation Institute

Average Congestion Cost by Metro Area Size

Millions of dollars, logarithmic axis scale t h A meri c an I nd u s ry N or

Property of Property of

Source: United States Department of Transportation (DOT) Administration Research and Innovative Technology (RITA) Administration, Bureau of Transportation Statistics (BTS) Transportation Statistics 2008

HDMA The 2009HDMA Global Commercial Vehicle Report 57 Truck Sales

Sales of medium and heavy duty and trucks have reported declines matters is another large change for model year 2010. Are 2008 sales of over fifty percent and higher since the end of the 2006 pre-buy, driven down by fleet manager anticipation of buying 2009 models according to Ward’s Automotive AutoInfoBank figures. In the 20 to avoid the price increases and uncertainty of 2010? This doesn’t months starting with January 2007, the first month after the pre-buy, appear to have been the case in 2005, but unlike 2008, 2005 was 500,028 Class 5, 6, 7 and 8 trucks have been sold. By comparison, only before a pre-buy year, not both before and after. With the pace in the 20 months prior to the pre-buy, sales of Class 5, 6, 7 and 8 of change and frequency of pre-buy activity, comparing current sales trucks totaled 798,099. to previous years may not longer be meaningful.

Judging the impact on 2008 sales of the model year 2007 EPA man- 2008 Class 8 trucks have seen the longest hangover since the pre- dates, the driving force behind the massive changes in truck sales buy of 2006, still averaging under half the same month sales of 2005. volume, is difficult to quantify. 2006 sales are inflated due to the Class 8 posted the largest increase in sales for model year 2006, so if pre-buy activity, so offer a poor basis for comparison. 2007 sales are history were to repeat itself, 2009 could be a recording setting year depressed due to orders being filled in 2006. Further complicating in for Class 8 sales.

Heavy Vehicle Sales in the United States – 1997-8/2008 N or t h A meri c an I nd u s ry

Source: Ward’s Automotive AutoInfoBank Property of

58 The 2009 Global CommerHDMAcial Vehicle Report Vehicle Population

Based on R.L. Polk data, at year end 2007, there were 7.21 mil- Age distribution of heavy trucks varies by class. The median age of lion heavy trucks (Classes 5 through 8) in operation in the United Class 5 trucks is lowest, at just 8.47 years. Classes 6, 7 and 8, have States. The population is dominated by Class 8 trucks, which median ages of 12.35, 10.77 and 9.22 year, respectively. Beyond the account for 48.65% of heavy trucks. Of the remainder, 22.24% are median, the trend for Class 6 vehicles to be older becomes more Class 7, 21.17% Class 6 and 7.94 percent are Class 5. pronounced. The eightieth percentile, the age at which 80 percent of all trucks registered are newer than, is 28.87 years for Class 6. For Distribution of truck registrations in the United States is far from Class 5, it is 17.9, for Class 7 it is 19, and for Class 8, it is 17.6. Ser- uniform. Using 2005 U.S. Census data, it is possible to count the vice requirement of Class 6 vehicles will likely represent a different number of trucks per 1000 state residents. On the low end, we find breadth of product than for other classes as a result. Hawaii, with just 10.77 trucks per 1000 residents, and with the largest number of trucks per 1000 residents is North Dakota, 93.05. The large discrepancy between Class 5 and 6 median ages likely The high truck-to-resident ratios are dominated by the states of the relates to the uses of each vehicle type. Class 5 vehicles are often Great Plains and Rocky Mountains. Along with North Dakota, used for services such as beverage and product delivery, both mileage Montana, Nebraska, Oklahoma, South Dakota and Wyoming all intensive activities. By contrast, Class 6 vehicles are often outfitted have more than 50 heavy duty trucks per 1000 residents. By con- with specialized equipment that is used while the vehicle is station- trast, the lower count states are dominated by states with extensive ary, reducing mileage. Class 7 and 8 are the heaviest units used in urban areas; California, District of Colombia, Massachusetts, New long haul trucking, and therefore follow more the pattern of Class 5 York and Rhode Island. units.

Heavy Duty Vehicle Registrations by Class and State

State Class 5 Class 6 Class 7 Class 8 Total State Class 5 Class 6 Class 7 Class 8 Total Alabama 9,875 28,901 32,321 69,615 140,712 Montana 5,106 13,885 12,273 32,159 63,423 Alaska 2,734 4,738 4,516 9,426 21,414 Nebraska 6,822 24,439 13,484 70,857 115,602 Arizona 25,346 44,438 24,794 67,901 162,479 Nevada 5,399 11,568 9,233 17,639 43,839 Arkansas 4,598 14,190 15,097 49,021 82,906 New Hampshire 3,004 7,014 9,469 15,791 35,278 California 65,452 140,753 117,191 186,646 510,042 New Jersey 14,063 34,645 45,359 81,832 175,899 Colorado 11,156 27,946 21,775 49,831 110,708 New Mexico 4,394 9,509 9,874 18,738 42,515 Connecticut 6,938 14,097 20,311 26,184 67,530 New York 33,064 51,966 91,377 119,600 296,007 Delaware 1,557 9,088 6,548 9,216 26,409 North Carolina 16,608 55,392 59,143 113,433 244,576 District Of North Dakota 3,917 17,584 7,016 30,615 59,132 Columbia 655 1,055 1,254 2,977 5,941

Ohio 20,236 64,494 71,408 153,546 309,684 t h A meri c an I nd u s ry Florida 31,620 71,159 83,876 139,651 326,306 Oklahoma 9,962 32,095 24,619 110,969 177,645 Georgia 18,330 56,497 58,072 117,678 250,577 Oregon 12,439 21,565 24,693 44,172 102,869 N or Hawaii 1,009 2,097 3,760 6,883 13,749 Pennsylvania 22,614 70,892 82,932 183,643 360,081 Idaho 4,719 11,821 10,057 28,839 55,436 Rhode Island 1,486 3,789 4,827 9,000 19,102 Illinois 20,471 69,978 87,139 224,026 401,614 South Carolina 6,929 22,882 19,691 44,180 93,682 Indiana 11,491 39,833 50,778 100,433 202,535 South Dakota 3,992 14,650 9,007 25,783 53,432 Iowa 8,000 27,496 25,828 86,920 148,244 Tennessee 7,524 23,329 30,329 73,936 135,118 Kansas 10,093 31,510 23,922 53,551 119,076 Texas 29,945 88,877 98,033 259,859 476,714 Kentucky 7,837 29,435 28,322 48,204 113,798 Utah 5,115 11,647 11,311 41,245 69,318 Louisiana 6,798 20,378 21,304 44,504 92,984 Vermont 1,672 2,991 5,021 9,160 18,844 Maine 2,638 6,377 11,572 20,353 40,940 Virginia 10,903 37,123 46,079 66,735 160,840 Maryland 11,117 28,734 25,366 41,065 106,282 Washington 17,399 35,761 27,812 72,011 152,983 Massachusetts 8,636 18,895 22,586 34,872 84,989 West Virginia 2,994 9,437 10,933 19,146 42,510 Property of Michigan 15,243Property 41,104 51,219 109,780 217,346 Wisconsinof 9,078 28,000 38,112 117,544 192,734 Minnesota 13,281 37,396 38,652 101,305 190,634 Wyoming 2,413 6,232 5,853 17,620 32,118 Mississippi 3,649 12,274 12,896 36,719 65,538 Grand Total 572,743 1,527,449 1,605,293 3,511,287 7,216,772 Missouri 12,422 37,493 38,249 96,474 184,638

HDMA The 2009HDMA Global Commercial Vehicle Report 59 Age Structures of Class 5-8 Vehicle Registrations N or t h A meri c an I nd u s ry

Median Age of Heavy Vehicles Registered, by Class Truck Age Population Percentile by Class Age breaks for percentiles in multiples of 20, newest first

Source: © 2008, R. L. Polk & Co. Reproduction in whole or in part is prohibited Source: © 2008, R. L. Polk & Co. Reproduction in whole or in part is prohibited without written permission of R. L. Polk & Co. 248-728-7000, www.polk.com without written permission of R. L. Polk & Co. 248-728-7000, www.polk.com Property of

60 The 2009 Global CommerHDMAcial Vehicle Report Commercial Trailers

Trailer builds reached 282,750 in 2006, a 12.66% increase over start of the third millennium. While individual company market 2005, but slipped 21.63% in 2007, to 221,599 units, according to penetration is limited, their overall impact is quite large. One-in-six data from Trailer/Body Builders’ Trailer Output Report. Until the trailers built from 2000 to 2007 were built by companies that record 2007 decline, trailer builds had posted five consecutive years of yearly averages of under 3000 units. growth after losing 45% in 2001. Total 2006 trailer builds represented a complete recovery of the 2001 drop, by surpassing 2000 build 2008 new trailer registrations using R.L. Polk data show a 30% levels by 21,861 units, or 8.4%. However, that was negated by the decrease in the first seven months, compared to 2007. Trailer sharp drop in 2007, which returned build quantities to a level lower manufacturers are also feeling pressure from increased commodity than 2000, 2004, 2005 and 2006. costs, such as steel and aluminum. With declining housing starts, a key segment for trailer sales, the recovery is unlikely to be immedi- Trailer manufacture is dominated by Wabash, Great Dane and ate. MEMA estimates that total 2008 trailer registrations will fall Utility, controllers of over 50% of the market. Their dominance to approximately 192,000, marking the second consecutive year of does not, however, seem to deter competition. Over 30 different decline. Registrations will, therefore, fall by 43% in two years, based companies have registered trailer builds of more than 2000 since the on this projection.

Top 20 Five Year Trailers Builds by Manufacturer * - Other includes discontinued operations. Discontinued operations are not included in top 20.

Trailers 2003 2004 2005 2006 2007 5 year Total Great Dane 41,000 55,000 55,000 60,300 48,000 259,300 Wabash 36,230 47,744 51,808 59,900 45,524 241,206 Utility 23,688 30,802 34,333 36,636 30,648 156,107 Stoughton 9,900 14,850 17,005 18,900 11,400 72,055 Hyundai 8,871 9,270 11,514 14,498 12,950 57,103 Fontaine 4,700 7,357 8,478 11,041 7,221 38,797 Trailmobile Canada 5,479 7,943 8,246 8,400 5,682 35,750 MANAC 6,300 6,500 6,600 6,800 5,600 31,800 Strick 6,000 6,208 6,023 5,150 3,222 26,603 Vanguard - 2,910 4,903 8,113 6,189 22,115 Heil Trailer 2,300 3,000 4,000 4,500 4,750 18,550 Wilson Trailer (est) 3,000 3,500 3,500 4,000 3,500 17,500 t h A meri c an I nd u s ry Trail King 2,677 3,191 3,510 3,800 3,774 16,952

Lufkin 2,206 3,135 3,501 3,331 1,539 13,712 N or Road Systems 1,815 2,115 3,083 4,491 1,735 13,239 Timpte 1,774 2,336 2,746 3,090 3,000 12,946 Kentucky 2,085 2,798 2,595 2,122 1,515 11,115 Reitnour 812 1,685 2,577 3,738 1,985 10,797 East Manufacturing 1,360 1,925 2,500 2,740 1,625 10,150 MAC 1,158 1,582 2,162 2,574 2,643 10,119 Polar Tank 1,200 1,575 1,782 2,344 2,502 9,403 Other* 13,493 13,265 15,106 16,282 16,595 74,741 Property of Source: Trailer/Body PropertyBuilders’ Trailer Output Report of

HDMA The 2009HDMA Global Commercial Vehicle Report 61 Total North American Trailer Builds, 2000-2007 2000-2007 Total Trailer Construction Market Share

Source: Trailer/Body Builders’ Trailer Output Report

2003-2008 Trailer Registrations *MEMA estimate N or

2004 2005 2006 2007 2008*

t h A meri c an I nd u s ry Auto Transporter 398 339 464 518 230 Beverage 716 652 668 621 511 Chip 628 749 577 593 324 Container Chassis 21,725 19,212 11,315 4,385 6,262 Curtainside 416 393 419 304 95 Dolly 112 649 229 364 226 Dump 5,811 8,326 9,631 8,187 5,398 Enclosed Body Cargo 596 557 506 528 407 Enclosed Tag-A-Long 5,605 5,230 5,130 4,446 2,958 Enclosed Utility 36,684 36,036 34,310 28,998 19,132 Flatbed 15,584 20,445 25,222 17,669 9,862 Flatbed Drop Deck 3,243 3,834 5,255 4,520 3,036 Grain 3,581 4,053 4,615 5,899 6,752 Hopper 1,655 1,641 1,637 2,174 3,144 Livestock 5,276 4,472 4,222 4,052 3,710 Logging 437 466 452 1,296 1,445 Lowbed 2,277 2,524 2,898 3,370 2,949 Lowbed Drop Deck 896 856 872 1,019 997 Livestock Gooseneck 1,820 1,735 1,562 1,533 1,422 Roll-Off 66 52 45 72 44 Special 791 1,435 897 437 274 Tagalong 8,750 8,951 8,541 7,384 6,995 Tank 5,374 5,798 6,632 7,297 6,486 Transfer 1,519 1,685 1,767 1,471 788 Unknown 9,876 11,432 11,891 10,244 9,589 Utility Property37,865 28,701 of30,524 21,824 18,399 Van 148,164 161,996 166,449 130,946 80,890 Total 319,865 332,219 336,730 270,151 192,324

62 The 2009 Global CommerHDMAcial Vehicle Report Canada

Increases in trade with nations that offer lower cost manufactur- $248,437,163,758, and is on schedule to exceed $275 billion in ing often dominates perceptions of the U.S. international trade 2008. 20% of that total was transportation industry related. At the situation, causing the role of Canada to be often forgotten. Despite same time, Canadian exports amounted to $ 313,110,879,133, with increases in trade with China and other nations, Canada is the an almost identical percentage as result of transportation industries. leading trade partner for the United States as a whole and for the While heavy duty vehicles are not enumerated separately in the transportation industry in particular. It is perhaps the proximity and available data, total motor vehicle parts are the largest contributor level of integration that leads people to not consider Canada as part to the transportation industry sector exports at $27,862,790,019 of international trade. or 43.5% of the total value. Transportation related imports from Canada reflect greater value in finished motor vehicles, however Based on Statistics Canada data, the GDP of Canada surpassed the 2006 parts imports accounted for 23.3%, worth $17,190,075,754. $1.2 trillion mark in 2007, however figures for 2008 are unlikely to show the same rate of improvement as in previous years. As of The trade of parts with Canada has fallen in 2008, likely due in part September 2008, the GDP was increasing at a rate of only one half to currency fluctuations, but also reflective of the overall economic of one percent. slowdown. Through three quarters, the value of parts exports to Canada fell by 11.9%. Parts imports fell 17.22% through the first Trade Stats Express™ provided by the US Department of Com- three quarters. If the rate holds, that will be a decrease of $3 billion merce reports that 2006 United States exports to Canada totaled for the year.

Value of one U.S. Expressed in Canadian Dollars Canada GDP millions of chained dollars (2002) * - MEMA estimate based on 2008 through September t h A meri c an I nd u s ry Source: Statistics Canada Source: Published End of Day Bank Rate N or

U.S. Automotive Parts Imports From Canada U.S. Automotive Parts Exports to Canada in millions in millions

Property of Property of

Source: U.S. Census Bureau and U.S. International Trade Administration Source: U.S. Census Bureau and U.S. International Trade Administration

HDMA The 2009HDMA Global Commercial Vehicle Report 63 Statistics Canada publishes a report called “Trucking in Canada” In 2005, less than one quarter of all truck trailers in Canada were about the for-hire trucking industry; the most recent edition covers leased. Of the major types, lease rates were highest, 31.7 percent, the year 2005. The industry in 2005 was experiencing a decline in for flat-deck trailers, and lowest for tank trailers, 8.3 percent. The profitability, margins dropping from just over 6% to just under four trailer fleet of Canada is dominated by vans which made up 46.78 in one year. Other highlights of the Canadian for-hire trucking percent. No other type of trailer reaches the level of one third that industry: number. l In 2005, there were about 3,360 Canadian-based for-hire carriers. l In 2005, 50% of trucking companies expenditures Sales of Trucks by Class were related to labor. l General freight transportation accounted for 60% of total revenues. Long-distance trucking captured 78% of total transportation revenues. l Overall, total assets were $13.5 billion. l The top 3% of all carriers accounted for nearly one third of total operating revenues. l Domestic transportation now accounts for two thirds of all shipments.

Canadian for-hire Trucking Company Revenues and Expenses N or Source: DesRosiers Automotive Consultants Inc. and CVMA t h A meri c an I nd u s ry 2007 Canadian Class 8 Truck Sales Market Share

Source: Statistics Canada

Canadian for-hire Trucking Company Revenues by Freight Category

Source: Automotive Consultants Inc. and CVMA

2005 Canadian Trailer Inventory by Type and Ownership

Source: Statistics CanadaProperty of New truck sales in Canada for 2007 mirrored the trends in the U.S. market, showing a sharp decline after a record setting 2006 sales year. Sales fell to 34,999 based on DesRosiers Automotive Consul- tants Inc. and CVMA figures, a 30.74 percent decline. The hardest hit were sales of Class 8 units, which dropped by 35.5 percent compared to the previous year. Source: Statistics Canada

64 The 2009 Global CommerHDMAcial Vehicle Report Mexico

Mexico is home to 109,555,400 persons (July 2008 estimate) based Freight transportation in Mexico is dominated by over the road on the CIA World Factbook and has an estimate 2008 Gross activities. Quantified in ton/miles, road transportation accounted Domestic Product (GDP) of over 12 trillion pesos according to for 81% of the total in Mexico, based on the North American Trans- Instituto Nacional de Estadísticas Geografía y Informática (INEGI) portation Statistics Database (NATS). Unlike in the United States Sistema de Cuentas Nacionales de México. where gross tonnage totals are largest for rail travel on account of their dominance in shipments of grains and minerals, in Mexico, Overall economic growth slowed, based on INEGI figures, from road transport dominates by that measure as well, increasing share a 5% annual rate in 2006 to 1.6% in the third quarter of 2008. to over 86% of the reported total. The final measure, by shipment Manufacturing has been particularly hard hit, showing 0.2% lost in value, road freight is responsible for 54% of the total in Mexico. annual percentage change in the third quarter of 2008. Adding to the uncertainty for companies in Mexico is a currency that is rapidly In 2007, NATS data showed a significant shift in heavy vehicle losing value. Against the US Dollar, the Mexican Peso has lost ap- mileage in Mexico: the Class 8 tractor mileage surpassed that of the proximately 17% of its value in 2008. fixed chassis truck. A large contributor to this trend is the continu- ally increasing amount of international merchandise trade in which A declining Peso may help Mexico regain some of the labor price Mexico participates. In 1997, the total trade was valued at $220 advantage it has lost to other areas of the world. Based on BLS data, billion. In 2007, one decade later, it was $553 billion. The amount Mexican labor remains competitive against Eastern European and of road trade has surged to $312 billion, from $135 billion in 1997. other Latin American nations, but the gap with Asian nations Trailers are going to provide efficiencies that fixed chassis trucks is shrinking. Between 2000 and 2007, Mexican labor lost about simply cannot in any type of long haul service. one quarter of its price advantage over Taiwan. While geographic proximity to the United States remains an advantage for Mexico, as Unfortunately, Mexican infrastructure is struggling to keep up. the currency dips in value, the ability of Mexico to remain a viable Paved road mileage has grown by just 18% since 1995, while ton source of low cost labor is enhanced. miles of freight have increased by over double that amount in the same timeframe. Government spending reflects these priorities as well, providing little to roads as compared to other modes and com- Mexico GDP pared to their relative share of traffic. Billions of Pesos, Current Prices

Billions of Ton Miles of Freight in Mexico t h A meri c an I nd u s ry N or

Source: Instituto Nacional de Estadísticas Geografía y Informática (INEGI)

Value of one U.S. Expressed in Mexican Pesos Source: North American Transportation Statistics Database

The North American Transportation Statistics Database is a collaboration between the U.S. Department of Transportation; Research and Innovative Technology Administration; Bureau of Transportation Statistics; U.S. Department of Commerce, Property of Property Censusof Bureau, Statistics Canada; Transport Canada and Insti- tuto Mexicano del Transporte; Instituto Nacional de Estadís- tica, Geografía e Informática, Secretaría de Comunicaciones y Transportes.

Source: Published End of Day Bank Rate

HDMA The 2009HDMA Global Commercial Vehicle Report 65 Millions of Heavy Vehicle Miles Heavy vehicle production in Mexico has grown rapidly in the third Annual Total by Vehicle Type millennium. Based on data provided by Industria Nacional de Autopartes, A.C. (INA), 91,711 trucks, Class 8 tractors and buses were produced in Mexico. While the total is still small compared to the United States and Canada, the growth rate is impressive. In just the past five years, heavy vehicle production has increased by 90%. Even with the growth, however, Mexican vehicle production is still dominated by light vehicles. Heavy vehicles account for less than one in twenty produced.

Production of Heavy Vehicles by Year

Source: North American Transportation Statistics Database

Thousands of Miles of Roads in Mexico N or

t h A meri c an I nd u s ry Source: Industria Nacional de Autopartes, A.C. (INA)

2007 Vehicle Production by Type with Heavy Vehicle Breakout

Source: North American Transportation Statistics Database

Mexican Government Spending by Transportation Mode 2006, Millions of Dollars

Source: Industria Nacional de Autopartes, A.C. (INA)

Mexico Producer Price Index for Class 8 Trucks

Property of

Source: North American Transportation Statistics Database

Source: Industria Nacional de Autopartes, A.C. (INA)

66 The 2009 Global CommerHDMAcial Vehicle Report January 2008 Age Distribution by Vehicle Type Heavy Truck Population Age Distribution For vehicles twelve years old and newer For vehicles twelve years old and newer

Source: Auto Strategies Inc.

Source: Industria Nacional de Autopartes, A.C. (INA)

Medium Truck Population Age Distribution Bus Population Age Distribution For vehicles twelve years old and newer For vehicles twelve years old and newer t h A meri c an I nd u s ry N or Source: Industria Nacional de Autopartes, A.C. (INA) Source: Industria Nacional de Autopartes, A.C. (INA)

The North American Transportation Statistics Database, a collaboration between the U.S. Department of Transportation; Research and In- novative Technology Administration; Bureau of Transportation Statistics; U.S. Department of Commerce, Census Bureau, Statistics Canada; Transport Canada and Instituto Mexicano del Transporte; Instituto Nacional de Estadística, Geografía e Informática, Secretaría de Comunica- ciones y Transportes. Property of Property of

HDMA The 2009HDMA Global Commercial Vehicle Report 67 Global Highway Transportation

Highway transportation provides the lifeblood of the industrialized It is the role of the heavy duty industry to provide the trucks to nations and for much of the world. Clearly, access to food is the accomplish this goal, and it is the role of the heavy duty parts and most important service provided by transportation, but the develop- components manufacturer to make it possible to build and maintain ment of the necessary highway infrastructure in itself provides addi- those trucks. tional employment, a framework for development, access to markets and a means for developing countries to enter the ranks of industri- Presented here is useful information about the roads and vehicle alized nations. In a world that strives towards equality, opportunity penetration and production around the world. Wherever possible, and individual freedom, the primary goal, before free digital televi- the attempt was made to insure comparability of the data between sion or even web access, should be the development of a highway nations. The nature of personal and commercial transportation in transportation system that links all the villages of the world. In the United States and Canada prevent a direct comparison with the developing nations, rail system development is non-existent due to rest of the world. However, the source of the estimates is consistent costs to implement. Roads are being built for trucks to move goods with the methodologies used in this section, and accurate U.S. throughout these developing nations. statistics are presented elsewhere in this report.

Highway Infrastructure Global H i g h w Country miles of Roadways population land Area persons/ landArea/ roads/ (square miles) roadMile roads landArea World 20,098,354 6,677,563,921 196,939,905 332.2 9.8 0.10 United States 3,995,644 303,824,646 3,794,083 76.0 0.9 1.05 European Union 3,274,106 491,018,677 1,669,808 150.0 0.5 1.96 India 2,102,313 1,147,995,898 1,269,346 546.1 0.6 1.66 China 1,199,584 1,330,044,605 3,705,407 1,108.8 3.1 0.32 Brazil 1,088,560 191,908,598 3,286,488 176.3 3.0 0.33 ay Transpor Japan 741,296 127,288,419 145,883 171.7 0.2 5.08 Canada 647,655 33,212,696 3,855,103 51.3 6.0 0.17 France 590,915 64,057,790 248,429 108.4 0.4 2.38 Russia 530,651 140,702,094 6,592,772 265.1 12.4 0.08 Australia 505,157 20,600,856 2,967,909 40.8 5.9 0.17 Spain 423,293 40,491,051 194,897 95.7 0.5 2.17 Italy 301,171 58,145,321 116,306 193.1 0.4 2.59 t

a Turkey 265,267 71,892,807 301,384 271.0 1.1 0.88 t ion Sweden 264,050 9,045,389 173,732 34.3 0.7 1.52 Poland 263,460 38,500,696 120,726 146.1 0.5 2.18 Indonesia 242,962 237,512,355 741,100 977.6 3.1 0.33 United Kingdom 241,097 60,943,912 94,526 252.8 0.4 2.55 South Africa 224,998 43,786,115 471,011 194.6 2.1 0.48 Mexico 221,795 109,955,400 761,606 495.8 3.4 0.29 Pakistan 161,406 167,762,040 310,403 1,039.4 1.9 0.52 Bangladesh 148,648 153,546,901 55,599 1,033.0 0.4 2.67 Germany 143,847 82,369,548 137,847 572.6 1.0 1.04 Argentina 143,769 40,677,348 1,068,302 282.9 7.4 0.13 Vietnam 138,056 86,116,559 127,244 623.8 0.9 1.08 Philippines 124,297 92,681,453 115,831 745.6 0.9 1.07 Romania Property123,539 22,246,862 of91,699 180.1 0.7 1.35 Nigeria 120,049 138,283,240 356,669 1,151.9 3.0 0.34 Iran 111,467 65,875,223 636,296 591.0 5.7 0.18

Source: CIA World Factbook July 2008

68 The 2009 Global CommerHDMAcial Vehicle Report Highway Infrastructure

Country miles of Roadways population land Area persons/ landArea/ roads/ (square miles) roadMile roads landArea Ukraine 105,308 45,994,287 233,090 436.8 2.2 0.45 Saudi Arabia 104,142 28,161,417 830,000 270.4 8.0 0.13 Colombia 102,065 45,013,674 439,736 441.0 4.3 0.23 Hungary 99,151 9,930,915 35,919 100.2 0.4 2.76 Congo, DR 95,379 66,514,506 905,568 697.4 9.5 0.11 Belgium 93,558 10,403,951 11,787 111.2 0.1 7.94 Netherlands 83,873 16,645,313 16,033 198.5 0.2 5.23 Austria 83,208 8,205,533 32,382 98.6 0.4 2.57 Czech Republic 79,452 10,220,911 30,450 128.6 0.4 2.61 Greece 73,032 10,722,816 50,942 146.8 0.7 1.43 Algeria 67,296 33,769,669 919,595 501.8 13.7 0.07 Korea, South 63,562 49,232,844 38,023 774.6 0.6 1.67 Malaysia 61,342 25,274,133 127,317 412.0 2.1 0.48 Zimbabwe 60,546 12,382,920 150,804 204.5 2.5 0.40 Sri Lanka 60,451 21,128,773 25,332 349.5 0.4 2.39 t ion

Ireland 60,026 4,156,119 27,135 69.2 0.5 2.21 a t Venezuela 59,748 26,414,815 352,144 442.1 5.9 0.17 Syria 58,962 19,747,586 71,498 334.9 1.2 0.82 Belarus 58,904 9,685,768 80,155 164.4 1.4 0.73 New Zealand 58,073 4,173,460 103,738 71.9 1.8 0.56 Norway 57,754 4,644,457 125,021 80.4 2.2 0.46 Burkina Faso 57,474 15,264,735 105,869 265.6 1.8 0.54 Egypt 57,396 81,713,517 386,662 1,423.7 6.7 0.15 ay Transpor ay Zambia 56,818 11,669,534 290,586 205.4 5.1 0.20 Kazakhstan 55,935 15,340,533 1,049,155 274.3 18.8 0.05 Libya 51,698 6,173,579 679,362 119.4 13.1 0.08 Uzbekistan 50,704 28,268,440 172,742 557.5 3.4 0.29 Cote d’Ivoire 49,710 18,373,060 124,503 369.6 2.5 0.40 Lithuania 49,700 3,565,205 25,212 71.7 0.5 1.97 Chile 49,464 16,454,143 292,260 332.6 5.9 0.17 Tanzania 49,021 40,213,162 364,900 820.3 7.4 0.13 Global H i g h w Peru 48,982 29,180,899 496,226 595.7 10.1 0.10 Finland 48,977 5,244,749 130,559 107.1 2.7 0.38 Portugal 48,759 10,676,910 35,672 219.0 0.7 1.37 Uruguay 48,300 3,477,778 68,039 72.0 1.4 0.71 Denmark 44,964 5,484,723 16,639 122.0 0.4 2.70 Yemen 44,304 23,013,376 203,850 519.4 4.6 0.22 Switzerland 44,302 7,581,520 15,942 171.1 0.4 2.78 Uganda 43,960 31,367,972 91,136 713.6 2.1 0.48 Latvia 43,390 2,245,423 24,938 51.8 0.6 1.74 Property of Kenya Property39,311 37,953,838 of224,962 965.5 5.7 0.17 Bolivia 38,823 9,247,816 424,164 238.2 10.9 0.09 Ghana 38,662 23,382,848 92,456 604.8 2.4 0.42

Source: CIA World Factbook July 2008

HDMA The 2009HDMA Global Commercial Vehicle Report 69 Highway Infrastructure

Country miles of Roadways population land Area persons/ landArea/ roads/ (square miles) roadMile roads landArea Cuba 37,815 11,423,952 42,803 302.1 1.1 0.88 Azerbaijan 36,749 8,177,717 33,436 222.5 0.9 1.10 Morocco 35,807 34,343,219 172,414 959.1 4.8 0.21 Thailand 35,669 65,493,298 198,457 1,836.2 5.6 0.18 Estonia 35,428 1,307,605 17,462 36.9 0.5 2.03 Angola 31,956 12,531,357 481,354 392.1 15.1 0.07 Cameroon 31,069 18,467,692 183,568 594.4 5.9 0.17 Madagascar 30,961 20,042,551 226,657 647.3 7.3 0.14 Mongolia 30,603 2,996,081 603,909 97.9 19.7 0.05 Iraq 28,303 28,221,181 168,754 997.1 6.0 0.17 Guinea 27,557 10,211,437 94,926 370.6 3.4 0.29 Bulgaria 27,361 7,262,675 42,823 265.4 1.6 0.64 Global H i g h w Ecuador 26,841 13,927,650 109,483 518.9 4.1 0.25 Slovakia 26,715 5,455,407 18,859 204.2 0.7 1.42 Namibia 26,245 2,088,669 318,696 79.6 12.1 0.08 Taiwan 25,018 22,920,946 13,892 916.2 0.6 1.80 Slovenia 23,959 2,007,711 7,827 83.8 0.3 3.06 Cambodia 23,772 14,241,640 69,900 599.1 2.9 0.34 Serbia 22,913 10,159,046 29,913 443.4 1.3 0.77 Ethiopia 22,661 78,254,090 435,186 3,453.3 19.2 0.05 ay Transpor Costa Rica 21,953 4,195,914 19,730 191.1 0.9 1.11 Oman 21,726 3,311,640 82,031 152.4 3.8 0.26 Afghanistan 21,613 32,738,376 250,001 1,514.8 11.6 0.09 Chad 20,754 10,111,337 495,755 487.2 23.9 0.04 Laos 19,393 6,677,534 91,429 344.3 4.7 0.21 Mozambique 18,890 21,284,701 309,496 1,126.8 16.4 0.06 Paraguay 18,330 6,831,306 157,047 372.7 8.6 0.12 t

a Croatia 17,888 4,491,543 21,831 251.1 1.2 0.82 t ion Tajikistan 17,254 7,211,884 55,251 418.0 3.2 0.31 Burma 16,777 47,758,181 261,970 2,846.6 15.6 0.06 Puerto Rico 15,991 3,958,128 5,324 247.5 0.3 3.00 Korea, North 15,879 23,479,089 46,541 1,478.7 2.9 0.34 Botswana 15,196 1,842,323 231,804 121.2 15.3 0.07 Central African Republic 15,104 4,434,873 240,535 293.6 15.9 0.06 Turkmenistan 14,913 5,179,571 188,456 347.3 12.6 0.08 Somalia 13,732 9,558,666 246,201 696.1 17.9 0.06 Bosnia and Herzegovina 13,574 4,590,310 19,772 338.2 1.5 0.69 Jamaica 13,392 2,804,332 4,244 209.4 0.3 3.16 Georgia 12,581 4,630,841 26,911 368.1 2.1 0.47 Papua New Guinea 12,179 5,931,769 178,704 487.1 14.7 0.07 Tunisia Property11,950 10,383,577 of63,170 868.9 5.3 0.19 Nicaragua 11,828 5,785,846 49,998 489.1 4.2 0.24 Mali 11,625 12,324,029 478,767 1,060.1 41.2 0.02

Source: CIA World Factbook July 2008

70 The 2009 Global CommerHDMAcial Vehicle Report Highway Infrastructure

Country miles of Roadways population land Area persons/ landArea/ roads/ (square miles) roadMile roads landArea Kyrgyzstan 11,495 5,356,869 76,641 466.0 6.7 0.15 Niger 11,448 13,272,679 489,191 1,159.4 42.7 0.02 Albania 11,185 3,619,778 11,100 323.6 1.0 1.01 Israel 10,990 7,112,359 8,019 647.2 0.7 1.37 Congo, Republic of the 10,743 3,903,318 132,047 363.3 12.3 0.08 Nepal 10,737 29,519,114 56,827 2,749.2 5.3 0.19 Benin 9,942 8,294,941 43,483 834.3 4.4 0.23 Malawi 9,601 13,931,831 45,745 1,451.1 4.8 0.21 Cyprus 9,091 792,604 3,571 87.2 0.4 2.55 Guatemala 8,758 13,002,206 42,043 1,484.6 4.8 0.21 Rwanda 8,704 10,186,063 10,169 1,170.3 1.2 0.86 Honduras 8,451 7,639,327 43,278 904.0 5.1 0.20 Senegal 8,436 12,853,259 75,749 1,523.7 9.0 0.11 Macedonia 8,191 2,061,315 9,781 251.7 1.2 0.84

Iceland 8,114 304,367 39,769 37.5 4.9 0.20 t ion

Moldova 7,870 4,324,450 13,067 549.5 1.7 0.60 a t Dominican Republic 7,829 9,507,133 18,815 1,214.3 2.4 0.42 Burundi 7,657 8,691,005 10,745 1,135.1 1.4 0.71 Sudan 7,394 40,218,455 967,499 5,439.1 130.8 0.01 Panama 7,235 3,292,693 30,193 455.1 4.2 0.24 Sierra Leone 7,021 6,294,774 27,699 896.5 3.9 0.25 El Salvador 6,764 7,066,403 8,124 1,044.7 1.2 0.83 Liberia 6,587 3,334,587 43,000 506.3 6.5 0.15 ay Transpor ay Gabon 5,698 1,485,832 103,347 260.8 18.1 0.06 Trinidad and Tobago 5,170 1,047,366 1,980 202.6 0.4 2.61 Bhutan 5,002 682,321 18,147 136.4 3.6 0.28 Guyana 4,952 770,794 83,000 155.6 16.8 0.06 Qatar 4,822 928,635 4,416 192.6 0.9 1.09 Armenia 4,785 2,968,586 11,484 620.5 2.4 0.42 Mauritania 4,760 3,364,940 397,956 707.0 83.6 0.01 Jordan 4,723 6,198,677 35,637 1,312.4 7.5 0.13 Global H i g h w Togo 4,673 5,858,673 21,925 1,253.8 4.7 0.21 Montenegro 4,578 678,177 5,415 148.1 1.2 0.85 Lebanon 4,331 3,971,941 4,015 917.1 0.9 1.08 Timor-Leste 3,753 1,108,777 5,794 295.4 1.5 0.65 Lesotho 3,691 2,128,180 11,720 576.6 3.2 0.31 Kuwait 3,572 2,596,799 6,880 726.9 1.9 0.52 New Caledonia 3,375 224,824 7,359 66.6 2.2 0.46 Luxembourg 3,248 486,006 998 149.6 0.3 3.25 West Bank 3,104 2,611,904 2,263 841.4 0.7 1.37 Property of Suriname Property2,674 475,996 of63,039 178.0 23.6 0.04 Haiti 2,585 8,924,553 10,714 3,452.6 4.1 0.24 Eritrea 2,492 5,028,475 46,842 2,018.1 18.8 0.05

Source: CIA World Factbook July 2008

HDMA The 2009HDMA Global Commercial Vehicle Report 71 Highway Infrastructure

Country miles of Roadways population land Area persons/ landArea/ roads/ (square miles) roadMile roads landArea Gambia, The 2,325 1,735,464 4,363 746.4 1.9 0.53 Brunei 2,268 381,371 2,228 168.2 1.0 1.02 Swaziland 2,233 1,128,814 6,704 505.5 3.0 0.33 Bahrain 2,174 718,306 257 330.5 0.1 8.47 Guinea-Bissau 2,147 1,503,182 13,946 700.2 6.5 0.15 Fiji 2,138 931,741 7,054 435.9 3.3 0.30 Singapore 2,027 4,608,167 268 2,273.5 0.1 7.58 Djibouti 1,905 506,221 8,880 265.8 4.7 0.21 Equatorial Guinea 1,790 616,459 10,831 344.5 6.1 0.17 Belize 1,785 301,270 8,867 168.8 5.0 0.20 Bahamas, The 1,673 307,451 5,382 183.7 3.2 0.31 French Polynesia 1,609 283,019 1,609 175.9 1.0 1.00

Global H i g h w Samoa 1,452 217,083 1,137 149.5 0.8 1.28 Malta 1,384 403,532 122 291.6 0.1 11.34 Mauritius 1,260 1,274,189 788 1,011.1 0.6 1.60 Marshall Islands 1,260 63,174 70 50.1 0.1 18.03 Hong Kong 1,248 7,018,636 422 5,622.4 0.3 2.96 Kosovo 1,196 2,126,708 4,203 1,778.9 3.5 0.28 Barbados 994 281,968 166 283.6 0.2 5.97 Solomon Islands 864 581,318 10,985 672.6 12.7 0.08 ay Transpor Cape Verde 839 426,998 1,557 509.0 1.9 0.54 Virgin Islands 781 108,210 737 138.5 0.9 1.06 Antigua and Barbuda 724 69,842 171 96.5 0.2 4.23 Grenada 700 90,343 133 129.0 0.2 5.27 United Arab Emirates 676 4,621,399 32,278 6,835.9 47.7 0.02 Vanuatu 665 215,446 4,710 324.0 7.1 0.14 Guam 607 175,877 209 289.7 0.3 2.91 t

a Saint Lucia 565 172,884 238 305.7 0.4 2.38 t ion Comoros 547 731,775 838 1,338.3 1.5 0.65 Saint Vincent and the Grenadines 515 118,432 150 229.9 0.3 3.43 Isle of Man 497 76,220 221 153.3 0.4 2.25 Cayman Islands 488 47,862 101 98.1 0.2 4.82 Dominica 485 72,514 291 149.6 0.6 1.66 Tonga 423 119,009 289 281.7 0.7 1.46 Kiribati 416 110,356 313 265.1 0.8 1.33 Northern Mariana Islands 333 86,616 184 260.1 0.6 1.81 Faroe Islands 288 48,668 540 169.2 1.9 0.53 Seychelles 285 82,247 176 289.0 0.6 1.62 Bermuda 278 66,536 20 239.6 0.1 13.57 Falkland IslandsProperty of (Islas Malvinas) 273 3,140 4,700 11.5 17.2 0.06 Macau 239 460,823 11 1,931.3 0.0 22.07

Source: CIA World Factbook July 2008

72 The 2009 Global CommerHDMAcial Vehicle Report Highway Infrastructure

Country miles of Roadways population land Area persons/ landArea/ roads/ (square miles) roadMile roads landArea Cook Islands 199 21,923 92 110.3 0.5 2.17 Sao Tome and Principe 199 206,178 386 1,036.9 1.9 0.51 Saint Kitts and Nevis 199 39,619 101 199.3 0.5 1.97 Andorra 168 72,413 181 431.6 1.1 0.93 Micronesia, Federated States of 149 107,665 271 722.0 1.8 0.55 Niue 145 1,444 100 9.9 0.7 1.45 Montserrat 141 9,638 39 68.3 0.3 3.58 Saint Helena 123 7,601 159 61.8 1.3 0.77 American Samoa 115 57,496 77 500.2 0.7 1.50 British Virgin Islands 110 24,004 59 218.3 0.5 1.86 Anguilla 109 14,108 39 129.7 0.4 2.76 Christmas Island 88 1,402 52 15.9 0.6 1.69 Turks and Caicos Islands 75 22,352 166 297.3 2.2 0.45

San Marino 65 29,973 24 463.8 0.4 2.74 t ion

Maldives 55 379,174 116 6,934.3 2.1 0.47 a t Norfolk Island 50 2,128 14 42.8 0.3 3.68 Monaco 31 32,796 1 1,055.6 0.0 40.23 Gibraltar 18 28,002 3 1,554.0 0.1 6.67 Cocos (Keeling) Islands 14 596 5 43.6 0.4 2.53 Tuvalu 5 12,177 10 2,449.6 2.0 0.50

Source: CIA World Factbook July 2008 ay Transpor ay Global H i g h w

Property of Property of

HDMA The 2009HDMA Global Commercial Vehicle Report 73 Highway Freight Movement Freight Transport by Roadway for Selected Countries Million of ton-miles percent Change 1990 2000 2005 2006 2005 to 2006 Albania 819 1,482 2,199 2,264 3.0% Australia 61,863 93,495 115,499 137,504 11.6% Austria 6,175 11,750 11,568 12,908 11.6% Azerbaijan 2,251 2,585 5,391 5,869 8.9% Belarus 21,952 34,948 30,032 31,273 4.1% Belgium 9,432 2,096 3,456 3,977 15.1% Bosnia-Herzegovina 2,100 218 301 343 13.9% Bulgaria 15,316 6,152 5,987 5,822 -2.8% Switzerland 7,910 15,034 16,685 17,368 4.1% Czech Republic 15,965 26,737 29,759 34,500 15.9% Germany 116,372 192,263 212,411 226,037 6.4%

Global H i g h w Denmark 6,406 7,534 7,574 7,852 3.7% Spain 62,008 101,861 155,743 161,503 3.7% Estonia 3,089 2,693 5,234 5,958 13.8% Finland 17,398 18,984 19,050 17,459 -8.4% France 78,632 126,182 132,299 136,187 2.9% United Kingdom 91,029 105,279 109,803 114,434 4.2% Georgia 1,765 325 396 466 17.8% Greece 8,552 9,789 10,864 11,308 4.1%

ay Transpor Croatia 1,953 1,929 6,389 6,969 9.1% Hungary 10,383 8,319 7,808 8,506 8.9% Ireland 3,514 8,458 12,433 12,114 -2.6% Italy 121,882 108,606 111,038 115,556 4.1% Japan 187,842 214,468 229,442 234,867 2.4% Lithuania 5,025 5,321 10,896 12,421 14.0% Luxembourg 262 307 365 403 10.3% Latvia 4,009 3,280 5,854 7,491 28.0% t a Moldova 4,319 686 1,575 2,464 56.5% t ion Mexico 74,579 132,915 139,877 143,422 2.5% FYR Macedonia 1,499 532 2,692 4,611 71.3% the Netherlands 15,679 21,617 23,290 24,277 4.2% Norway 5,638 8,916 10,868 11,297 4.0% New Zealand 9,826 12,588 12,678 0.7% Poland 27,598 51,387 82,015 93,488 14.0% Portugal 7,481 10,241 11,935 12,451 4.3% Romania 3,567 6,767 13,287 15,559 17.1% Russia 205,046 104,615 132,603 136,144 2.7% Slovakia 9,823 15,445 15,147 -1.9% Slovenia 3,347 1,327 1,617 1,561 -3.5% Sweden 17,568 21,476 23,755 24,285 2.2% Turkey Property45,008 110,654 of114,270 118,943 4.1% Ukraine 10,133 5,166 13,356 17,261 29.2% United States 848,779 1,192,824 1,293,325 1,243,075 -3.9% European Union 644,326 888,181 1,030,790 1,087,120 5.5%

Source: The International Transport Forum and MEMA estimates

74 The 2009 Global CommerHDMAcial Vehicle Report Global Commercial Vehicle Population

Trucks and Busses in Operation 2005 2006 Growth Africa 5,570,847 5,938,062 6.6%

Algeria 829,600 829,591 0.0% Angola 29,000 139,556 381.2% Benin 96,600 96,600 0.0% Botswana 111,503 116,082 4.1% Burkina Faso 9,100 9,144 0.5% Burundi 9,300 9,500 2.2% Cameroon 68,000 68,000 0.0% Central African Republic 6,300 6,300 0.0% Congo Democratic Rep (Zaire) 41,600 41,800 0.5% Congo, Republic 23,100 23,100 0.0% Ethiopia 53,600 110,079 105.4% Ghana 142,300 142,300 0.0% Ivory Coast 54,900 57,094 4.0% Kenya 124,600 124,559 0.0%

Liberia 12,800 12,800 0.0% t ion a

Libya 183,900 191,900 4.4% t Madagascar 54,200 54,500 0.6% Malawi 57,600 57,600 0.0% Mali 31,700 31,700 0.0% Mauritania 18,300 18,500 1.1% Mauritius 41,910 46,385 10.7% Morocco 327,173 355,201 8.6% Mozambique 50,700 50,741 0.1% ay Transpor ay Niger 18,300 18,329 0.2% Nigeria 327,500 327,458 0.0% Reunion 37,800 39,706 5.0% Senegambia 48,200 50,859 5.5% Sierra Leone 7,800 7,800 0.0% South Africa 2,186,161 2,269,573 3.8% Sudan 63,600 98,000 54.1% Tanzania 98,800 104,927 6.2% Togo 24,500 24,500 0.0% Global H i g h w Tunisia 189,000 188,986 0.0% Uganda 79,700 100,865 26.6% Zambia 32,100 34,413 7.2% Zimbabwe 79,600 79,614 0.0%

Caribbean 1,060,854 1,137,933 7.3%

Bahamas 36,535 40,201 10.0% Barbados 18,340 20,600 12.3% Property of BermudaProperty 5,376 of 6,100 13.5% Cuba 45,800 47,600 3.9% Dominican Republic 231,790 241,820 4.3% Guadeloupe 31,400 31,400 0.0%

HDMA The 2009HDMA Global Commercial Vehicle Report 75 Global Commercial Vehicle Population

Trucks and Busses in Operation 2005 2006 Growth

Haiti 30,800 31,500 2.3% Jamaica 73,800 78,100 5.8% Netherlands Antilles 33,777 34,277 1.5% Puerto Rico 504,542 550,900 9.2% Trinidad and Tobago 30,594 36,435 19.1% Virgin Islands (United States) 18,100 19,000 5.0%

Central & South America 9,177,276 10,747,447 17.1%

Argentina 1,282,357 1,956,954 52.6% Belize 7,703 8,278 7.5% Bolivia 57,900 58,464 1.0% Brazil 4,764,656 5,004,915 5.0%

Global H i g h w Chile 632,000 761,206 20.4% Colombia 352,195 355,943 1.1% Costa Rica 163,771 172,290 5.2% Ecuador 209,510 240,758 14.9% El Salvador 101,883 111,303 9.2% French Guiana 11,900 11,900 0.0% Guatemala 170,664 192,561 12.8% Guyana 15,500 15,500 0.0%

ay Transpor Honduras 101,397 107,916 6.4% Nicaragua 91,985 98,841 7.5% Panama 140,032 144,299 3.0% Paraguay 79,777 81,188 1.8% Peru 183,200 195,417 6.7% Suriname 29,946 29,900 -0.2% Uruguay 84,100 87,714 4.3% Venezuela 696,800 1,112,100 59.6% t a t ion North America 105,276,946 119,995,272 14.0%

Canada 5,475,558 6,700,097 22.4% Mexico 4,081,265 4,451,671 9.1% United States 95,720,123 108,843,504 13.7%

Asia - Far East 55,181,610 59,409,041 7.7%

Afghanistan 49,800 49,800 0.0% Bangladesh 103,499 103,499 0.0% Brunei 23,000 23,000 0.0% Burma 85,000 85,000 0.0% Hong Kong 114,400 132,000 15.4% India Property4,088,700 of 4,702,500 15.0% Indonesia 2,584,993 2,645,735 2.3% Japan 18,661,469 18,595,667 -0.4% Korea, South 3,728,600 4,288,317 15.0%

76 The 2009 Global CommerHDMAcial Vehicle Report Global Commercial Vehicle Population

Trucks and Busses in Operation 2005 2006 Growth

Asia - Far East (continued)

Malaysia 1,192,456 1,243,929 4.3% Pakistan 433,100 433,135 0.0% Peoples Republic of China 17,332,293 19,858,838 14.6% Philippines 828,752 862,657 4.1% Singapore 107,900 141,413 31.1% Sri Lanka 455,387 455,400 0.0% Taiwan 1,023,069 1,052,000 2.8% Thailand 4,164,570 4,515,651 8.4% Vietnam 204,622 220,500 7.8%

Asia - Middle East 7,456,487 8,087,918 8.5%

Bahrain 47,535 55,848 17.5% Cyprus 125,053 127,185 1.7% Egypt 517,104 550,360 6.4% t ion

Iran 410,568 469,201 14.3% a t Iraq 300,000 300,000 0.0% Israel 327,100 364,242 11.4% Jordan 103,453 152,441 47.4% Kuwait 289,034 335,899 16.2% Lebanon 245,400 245,367 0.0% Oman 224,002 249,019 11.2% Qatar 130,057 148,977 14.5% Saudi Arabia 1,346,200 1,365,470 1.4% Transpor ay Syria 248,200 266,177 7.2% Turkey 2,192,449 2,387,499 8.9% United Arab Emirates 663,386 758,922 14.4% Yemen 286,946 311,311 8.5%

Eastern Europe 45,509,815 48,065,618 5.6%

Bulgaria 142,200 200,035 40.7% Global H i g h w Czechoslovakia (former) 647,800 647,775 0.0% Hungary 676,949 900,197 33.0% Poland 1,304,238 1,378,412 5.7% Romania 653,896 814,654 24.6% Soviet Union (former) 5,119,500 5,538,672 8.2% Yugoslavia (former) 508,406 709,414 39.5%

Western Europe 28,480,250 29,778,237 4.6% Property of Austria Property362,463 of 367,350 1.3% Belgium and Luxembourg 659,199 675,666 2.5% Denmark 437,100 470,300 7.6% Finland 376,809 384,900 2.1% France 6,139,000 6,198,000 1.0%

HDMA The 2009HDMA Global Commercial Vehicle Report 77 Global Commercial Vehicle Population

Trucks and Busses in Operation 2005 2006 Growth

Germany 2,878,700 3,172,041 10.2% Gibraltar 1,600 2,124 32.8% Greece 964,300 1,213,681 25.9% Iceland 58,962 58,863 -0.2% Ireland 275,300 318,604 15.7% Italy 4,250,898 4,274,096 0.5% Malta 46,725 51,681 10.6% Netherlands 1,068,500 1,095,000 2.5% Norway 480,000 493,932 2.9% Portugal 1,305,700 1,323,270 1.3% Spain 4,660,375 4,907,867 5.3% Sweden 475,194 474,638 -0.1% Switzerland 342,979 353,049 2.9% Global H i g h w United Kingdom 3,696,446 3,943,175 6.7%

Pacific Area 3,256,398 3,319,500 1.9%

Australia 2,570,900 2,601,772 1.2% Fiji 22,800 23,600 3.5% French Pacific Ocean 27,731 30,400 9.6% Guam 3,800 6,800 78.9% New Caledonia 37,700 42,000 11.4% ay Transpor New Zealand 497,667 518,428 4.2% Papua New Guinea 87,800 88,100 0.3% Samoa (American) 3,300 3,500 6.1% Vanuatu 4,700 4,900 4.3% t a t ion

Property of

78 The 2009 Global CommerHDMAcial Vehicle Report Commercial Vehicle Sales

10 Year 2005 2006 Growth Trend World Summary Africa 396,545 455,083 14.8% 8.4% America, Caribbean 113,797 98,908 -13.1% 1.7% America, Central & South 1,033,236 1,146,735 11.0% 4.7% America, North 10,865,900 10,400,227 -4.3% 2.9% Asia, Far East 6,141,450 6,271,018 2.1% 4.6% Asia, Middle East 1,136,050 1,078,082 -5.1% 10.5% Europe, East 916,912 1,071,872 16.9% 9.9% Europe, West 2,248,087 2,480,032 10.3% 0.6% Pacific 423,307 406,494 -4.0% 7.1% Other 43,546 54,550 25.3% 0.3% World 23,318,830 23,463,001 0.6% 3.8%

Africa Algeria 56,331 54806 -2.7% 21.3%

Angola 7,904 12609 59.5% 13.7% t ion

Benin 327 270 -17.4% 0.8% a t Botswana 763 152 -80.1% -25.9% Burkina Faso 374 368 -1.6% -3.2% Burundi 466 86 -81.5% 17.5% Cameroon 976 1081 10.8% -5.8% Central African Republic 36 27 -25.0% -14.4% Congo Republic 340 457 34.4% 13.3% Ethiopia 2,921 4141 41.8% 2.4% Ghana 3,984 4526 13.6% 7.8% Transpor ay Ivory Coast 1,286 2113 64.3% -10.2% Kenya 8,669 9265 6.9% 6.3% Liberia 177 214 20.9% 1.1% Libya 13,479 17,732 31.6% 16.2% Madagascar 1,958 1,291 -34.1% -1.5% Malawi 989 1,524 54.1% 11.4% Mali 379 361 -4.7% 5.2%

Mauritania 737 503 -31.8% 5.0% Global H i g h w Mauritius 2,989 2,708 -9.4% 1.1% Morocco 37,237 41,512 11.5% 10.7% Mozambique 1,717 2,258 31.5% 11.5% Niger 48 30 -37.5% -15.3% Nigeria 10,641 16,449 54.6% 12.3% Reunion 1,820 1,556 -14.5% -2.5% Senegambia 2,580 3,046 18.1% 6.5% Sierra Leone 136 107 -21.3% 7.0% South Africa 188,129 219,744 16.8% 6.7% Property of Sudan Property8,629 of 9,938 15.2% 21.0% Tanzania 2,541 3,146 23.8% 3.4% Togo 65 79 21.5% -15.0% Tunisia 13,541 15,406 13.8% 2.0% Uganda 1,522 1,704 12.0% -7.4%

HDMA The 2009HDMA Global Commercial Vehicle Report 79 Commercial Vehicle Sales

10 Year 2005 2006 Growth Trend Africa (continued) Congo Dem Rep (Zaire) 1,430 1,129 -21.0% 13.5% Zambia 2,240 2,854 27.4% 17.6% Zimbabwe 3,233 4,171 29.0% -7.0% Other 15,951 17,720 11.1% 5.8% Africa 396,545 455,083 14.8% 8.4%

America, Caribbean Bahamas 2,259 2,429 7.5% 5.7% Barbados 3,405 2,559 -24.8% 4.7% Bermuda 890 752 -15.5% 1.7% Cuba 3,063 2,428 -20.7% 3.3% Dominican Republic 20,465 16,783 -18.0% -0.6% Global H i g h w Guadeloupe 276 460 66.7% -21.8% Haiti 1,631 2,294 40.6% -1.1% Jamaica 2,724 3,581 31.5% 5.2% Martinique 0 0 -48.0% Netherlands Antilles 2,707 2,654 -2.0% 1.5% Puerto Rico 61,477 49,709 -19.1% 1.4% Trinidad & Tobago 7,260 7,948 9.5% 13.6% Virgin Islands (US) 2,143 1,766 -17.6% 5.9% ay Transpor Other 5,497 5,545 0.9% 3.5% America, Caribbean 113,797 98,908 -13.1% 1.7%

America, Central & South Argentina 131,891 142,602 8.1% 1.2% Belize 197 241 22.3% -3.2% Bolivia 2,510 2,006 -20.1% -15.8% Brazil 493,295 495,209 0.4% 5.8% t

a Chile 119,692 121,689 1.7% 7.9% t ion Colombia 49,299 65,100 32.1% -1.2% Costa Rica 10,264 11,600 13.0% 7.9% Ecuador 44,999 62,090 38.0% 10.0% El Salvador 9,352 8,891 -4.9% 7.5% French Guiana 97 98 1.0% -33.0% Guatemala 16,715 17,819 6.6% 11.0% Guyana 110 250 127.3% -0.7% Honduras 7,312 9,060 23.9% 2.0% Nicaragua 4,937 4,468 -9.5% 1.6% Panama 11,554 14,944 29.3% 0.1% Paraguay 4,683 5,357 14.4% -7.8% Peru 12,887 16,461 27.7% 3.2% SurinameProperty 615 of 649 5.5% 4.2% Uruguay 3,511 8,412 139.6% -17.0% Venezuela 101,162 152,503 50.8% 11.6% Other 8,154 7,286 -10.6% -22.1% America, Central & South 1,033,236 1,146,735 11.0% 4.7%

80 The 2009 Global CommerHDMAcial Vehicle Report Commercial Vehicle Sales

10 Year 2005 2006 Growth Trend America, North Canada 785,088 803,166 2.3% 1.3% Mexico 511,354 585,783 14.6% 12.3% United States 9,569,439 9,011,242 -5.8% 2.6% Other 19 36 89.5% -10.3% America, North 10,865,900 10,400,227 -4.3% 2.9%

Asia, Far East Afghanistan 3,133 4,324 38.0% 45.1% Bangladesh 2,499 2,225 -11.0% 1.5% Brunei 3,667 3,331 -9.2% 8.9% Burma 270 310 14.8% -9.8% Hong Kong 17,484 16,484 -5.7% -1.3% India 571,187 708,515 24.0% 11.0% Indonesia 496,364 304,952 -38.6% 8.3% Japan 1,103,658 1,097,774 -0.5% -7.8% t ion a

Korea, South 520,521 495,973 -4.7% 6.3% t Malaysia 150,207 123,263 -17.9% 9.4% Pakistan 31,598 16,353 -48.2% 13.5% Peoples Republic of China 2,385,625 2,749,924 15.3% 10.6% Philippines 61,432 61,062 -0.6% 1.8% Singapore 13,198 11,735 -11.1% -0.6% Sri Lanka 2,378 2,628 10.5% -2.2%

Taiwan 237,535 168,212 -29.2% 6.5% Transpor ay Thailand 515,221 490,398 -4.8% 12.2% Vietnam 21,902 9,132 -58.3% 15.2% Other 3,571 4,423 23.9% -10.1% Asia, Far East 6,141,450 6,271,018 2.1% 4.6%

Asia, Middle East Bahrain 10,455 13,024 24.6% 15.9% Cyprus 8,119 5,882 -27.6% -0.1% Global H i g h w Egypt 46,459 58,025 24.9% 1.4% Iran 162,792 148,812 -8.6% 21.0% Iraq 6,616 8,071 22.0% 16.9% Israel 36,390 33,937 -6.7% -3.0% Jordan 13,968 19,330 38.4% 12.9% Kuwait 56,026 46,431 -17.1% 12.6% Lebanon 4,839 4,408 -8.9% -5.5% Oman 45,367 52,979 16.8% 9.7% Qatar 24,219 35,545 46.8% 15.5% Property of Saudi ArabiaProperty 198,984 of184,528 -7.3% 8.1%

HDMA The 2009HDMA Global Commercial Vehicle Report 81 Commercial Vehicle Sales

10 Year 2005 2006 Growth Trend Asia, Middle East (continued) Syria 17,703 20,441 15.5% -1.8% Turkey 408,782 341,869 -16.4% 12.9% United Arab Emirates 88,595 96,067 8.4% 12.5% Yemen 6,186 8,508 37.5% 2.2% Other 550 225 -59.1% 0.9% Asia, Middle East 1,136,050 1,078,082 -5.1% 10.5%

Europe, East Bulgaria 8,984 10,978 22.2% 5.8% Czechoslovakia (former) 60,362 77,571 28.5% 5.7% Hungary 21,698 22,779 5.0% 0.4%

Global H i g h w Poland 97,271 109,052 12.1% 9.8% Romania 40,882 40,798 -0.2% 7.8% USSR (former) 642,219 780,825 21.6% 12.1% Yugoslavia (former) 44,961 29,401 -34.6% 5.1% Other 535 468 -12.5% -22.5% Europe, East 916,912 1,071,872 16.9% 9.9%

Europe, West Austria 39,023 41,291 5.8% -0.8% ay Transpor Belgium & Luxembourg 79,570 76,378 -4.0% -1.3% Denmark 62,210 69,114 11.1% 7.2% Finland 19,960 20,982 5.1% 0.9% France 480,122 498,389 3.8% 2.5% Germany 272,776 304,433 11.6% -4.9% Gibraltar 477 511 7.1% 2.3% Greece 25,540 26,690 4.5% 4.0% t a Iceland 7,102 6,746 -5.0% 6.1% t ion Ireland 41,974 46,857 11.6% 3.4% Italy 222,778 249,179 11.9% 1.7% Malta 1,559 1,293 -17.1% -11.7% Netherlands 80,411 84,761 5.4% -3.4% Norway 42,681 49,243 15.4% 2.5% Portugal 75,097 70,472 -6.2% -6.3% Spain 329,195 454,016 37.9% 3.5% Sweden 41,807 47,194 12.9% -2.7% Switzerland 24,568 28,935 17.8% -6.5% United Kingdom 385,969 386,968 0.3% 2.8% Other 15,268 16,580 8.6% 10.1% Europe,Property West 2,248,087 of2,480,032 10.3% 0.6%

82 The 2009 Global CommerHDMAcial Vehicle Report Commercial Vehicle Sales

10 Year 2005 2006 Growth Trend Pacific Australia 379,465 364,272 -4.0% 7.6% Fiji 1,444 1,302 -9.8% 3.4% French Pacific Ocean 3,659 3,162 -13.6% 4.2% Guam 2,932 2,790 -4.8% 35.4% New Caledonia 5,513 6,437 16.8% 9.7% New Zealand 25,623 23,182 -9.5% 4.5% Papua New Guinea 2,943 3,933 33.6% -7.5% Samoa ,American 335 208 -37.9% 32.9% Vanuatu 293 220 -24.9% -4.6% Other 1,100 988 -10.2% -9.8% Pacific 423,307 406,494 -4.0% 7.1%

Other 43,546 54,550 25.3% 0.3%

World 23,318,830 23,463,001 0.6% 3.8% t ion a t ay Transpor ay Global H i g h w

Property of Property of

HDMA The 2009HDMA Global Commercial Vehicle Report 83 World Commercial Vehicle Production and Assembly

All trucks and busses, Class 1-8. 2005 2006 Growth Argentina Mercedes Benz 17,357 19,775 13.9% Ford 41,776 46,512 11.3% Chevrolet 6,188 8,410 35.9% Suzuki 807 279 -65.4% IVECO 3,193 3,414 6.9% Citroën 1,805 2,736 51.6% Peugeot 5,545 6,668 20.3% Renault 9,745 13,245 35.9% Toyota 46,162 64,334 39.4% Volkswagen 4,416 3,608 -18.3% Argentina Total 136,994 168,981 23.3%

Global H i g h w Australia (retail sales) Ford 58,149 47,966 -17.5% Hino 4,674 5,161 10.4% IHC 2,288 2,267 -0.9% Kenworth 2,283 2,053 -10.1% Mack 1,126 1,102 -2.1% MAN 179 237 32.4% Mercedes Benz 5,476 6,422 17.3% Mitsubishi 28,520 26,471 -7.2% ay Transpor Nissan Diesel 991 1,039 4.8% Scania 389 429 10.3% Holden 51,634 38,119 -26.2% Volvo 3,155 3,489 10.6% Australia (retail sales) Total 158,864 134,755 -15.2%

Austria t

a BMW/Chrysler/Jeep/Mercedes/Saab 178,106 181,603 2.0% t ion MAN 12,774 26,873 110.4% Austria Total 200,795 208,476 3.8%

Belarus BELAZ 1,452 1,659 14.3% MAZ 21,398 22,970 7.3% MOAZ 6 14 133.3% Belarus Total 22,856 24,643 7.8%

Belgium Mol 13 11 -15.4% Van Hool 1,040 1,143 9.9% Volvo(assembly)Property 30,366 of 34,973 15.2% Belgium Total 31,419 36,127 15.0%

84 The 2009 Global CommerHDMAcial Vehicle Report World Commercial Vehicle Production and Assembly

All trucks and busses, Class 1-8. 2005 2006 Growth Brazil Agrale 5,191 4,425 -14.8% Mercedes Benz 53,072 50,329 -5.2% Fiat 79,442 81,979 3.2% Ford 144,987 143,603 -1.0% Chevrolet 89,808 87,267 -2.8% International 1,016 1,389 36.7% IVECO 4,631 3,505 -24.3% Mitsubishi 20,153 20,171 0.1% Nissan 10,306 8,661 -16.0% Citroen 1,318 610 -53.7% Peugeot 3,972 5,338 34.4% Renault 3,776 5,290 40.1% Scania 14,371 16,094 12.0% Volkswagen 74,050 81,048 9.5% Volvo 12,122 9,322 -23.1% Brazil Total 518,806 519,031 0.0% t ion a

t Canada Chevrolet (assembly) 189,997 196,598 3.5% Chrysler 247,674 192,550 -22.3% Dodge 112,319 99,022 -11.8% Ford 79,365 60,898 -23.3% Lincoln 0 2,615

Mercury 4,991 3,379 -32.3% Transpor ay Chevrolet 224,088 173,631 -22.5% GMC 90,722 77,294 -14.8% Acura (assembly) 67,592 54,338 -19.6% Honda (assembly) 126,256 132,791 5.2% International 26,372 33,498 27.0% Kenworth 6,386 6,904 8.1% Sterling 26,480 25,982 -1.9% Lexus 73,104 76,939 5.2% Global H i g h w Canada Total 1,275,346 1,136,439 -10.9%

Chile Isuzu 6,660 6,660 0.0% Chile Total 6,660 6,660 0.0%

Colombia (assembly) Mazda 3,632 4,951 36.3% Mitsubishi 2,125 2,477 16.6% Property of ChevroletProperty 11,601 of 14,693 26.7% Toyota 13,606 8,445 -37.9% Colombia (assembly) Total 30,964 30,566 -1.3%

HDMA The 2009HDMA Global Commercial Vehicle Report 85 World Commercial Vehicle Production and Assembly

All trucks and busses, Class 1-8. 2005 2006 Growth Czech Republic Magma 46 13 -71.7% AUTO-Tech Vinor 590 559 -5.3% AVIA 553 482 -12.8% Mobilní Jeraby 21 20 -4.8% CTS servis 511 616 20.5% Daewoo, Tatra 345 298 -13.6% Hagemann Motoren 312 133 -57.4% Karosa 1,897 2,477 30.6% Karoseria 36 47 30.6% KH 49 45 -8.2% Navara Novosedly 212 196 -7.5% PANAV 0 162

Global H i g h w SOR 247 411 66.4% Tatra 1,497 1,511 0.9% Tedom 5 15 200.0% Liaz,Tatra,Dennis Scania,Avia 83 92 10.8% Czech Republic Total 6,787 7,077 4.3%

Egypt (assembly) BMW 0 220 Jeep 522 826 58.2% ay Transpor Fiat 71 0 -100.0% IVECO Magirus 60 60 0.0% TAM 100 0 -100.0% Zastava 0 0 Tata 5 1 -80.0% Chevrolet 14,647 18,215 24.4% Hyundai 0 55 t a Mercedes Benz 801 1,392 73.8% t ion MAN 60 11 -81.7% Mitsubishi 405 2,859 605.9% Nissan 1,940 2,995 54.4% Scania 9 9 0.0% Ssangyong 196 327 66.8% Suzuki 934 2,252 141.1% Volvo 2 7 250.0% Other 72 1,443 1904.2% Egypt (assembly) Total 20,068 30,672 52.8%

Finland Sisu 411 353 -14.1% Finland PropertyTotal 411 of 353 -14.1%

86 The 2009 Global CommerHDMAcial Vehicle Report World Commercial Vehicle Production and Assembly

All trucks and busses, Class 1-8. 2005 2006 Growth France Etalmobil 27 26 -3.7% EvoBus 527 522 -0.9% Heuliez 291 420 44.3% Renault 2,869 3,130 9.1% Citroen 58,223 64,794 11.3% Peugeot 68,166 62,903 -7.7% Renault 225,648 226,537 0.4% Renault Trucks 50,225 56,682 12.9% Scania 9,391 10,133 7.9% Ulysse, Scudo 20,680 20,874 0.9% France Total 436,047 446,021 2.3%

Germany Mercedes Benz 229,649 218,585 -4.8% Setra/Mercedes 5,258 0 -100.0% Ford 8,742 10,081 15.3% t ion a

Neoplan 538 0 -100.0% t IVECO Magirus 16,267 17,507 7.6% ERF 0 382 MAN 49,469 54,041 9.2% Multicar 1,105 1,542 39.5% Volkswagen 96,495 109,343 13.3% Germany Total 407,523 411,481 1.0%

Transpor ay Hungary Fiat 350 24,943 7026.6% Justy 6,511 4,494 -31.0% Czepel 600 600 0.0% Ikarus 200 200 0.0% Raba 100 100 0.0% Schwarzmüller 2,500 2,500 0.0% Hungary Total 10,261 32,837 220.0% Global H i g h w

India Ashok Leyland 63,981 77,985 21.9% Canter 24,066 26,988 12.1% Bajaj 16,276 14,412 -11.5% Ford 2,025 1,892 -6.6% Chevrolet (GM-DAT) 18,013 21,330 18.4% Hindustan 447 1,038 132.2% Hyundai 215 0 -100.0% Property of MahindraProperty 129,381 of 136,194 5.3% Maruti 74,682 80,277 7.5% Mazda 12,607 10,524 -16.5% Telco 263,743 363,571 37.9%

HDMA The 2009HDMA Global Commercial Vehicle Report 87 World Commercial Vehicle Production and Assembly

All trucks and busses, Class 1-8. 2005 2006 Growth India (continued) Tatra Udyog 127 84 -33.9% Toyota 36,760 37,497 2.0% Volvo 963 897 -6.9% India Total 643,286 772,689 20.1%

Indonesia (assembly) Daihatsu/Isuzu/Mitsubishi/Suzuki/Toyota 168,120 89,687 -46.7% Indonesia (assembly) Total 168,120 89,687 -46.7%

Iran (assembly estimate) Kia/Paykan/Nissan/Rover 104,000 152,000 46.2% Iran (assembly estimate) Total 104,000 152,000 46.2%

Global H i g h w Italy Bremach - FB 0 310 Fiat 126,258 129,796 2.8% IVECO 86,052 92,562 7.6% Piaggio 7,487 6,284 -16.1% PSA 90,611 88,524 -2.3% Italy Total 312,824 317,476 1.5% ay Transpor Japan Daihatsu 185,303 164,349 -11.3% Fuji 83,544 79,722 -4.6% Hino 96,985 100,122 3.2% Honda 48,642 55,767 14.6% Isuzu 210,253 230,807 9.8% Mazda 58,865 59,685 1.4% t a Mitsubishi Fuso 132,274 141,503 7.0% t ion Mitsubishi 109,360 101,134 -7.5% Nissan Diesel 41,071 42,833 4.3% Nissan 230,126 213,808 -7.1% Suzuki 169,778 168,509 -0.7% Toyota 415,056 367,369 -11.5% Other 1,667 2,110 26.6% Japan Total 1,782,924 1,727,718 -3.1%

Korea, South Daewoo 4,626 5,900 27.5% Daewoo 13,930 22,403 60.8% Hyundai 214,003 231,364 8.1% Kia Property105,030 of 83,828 -20.2% Tata 4,657 7,471 60.4% Korea, South Total 342,256 350,966 2.5%

88 The 2009 Global CommerHDMAcial Vehicle Report World Commercial Vehicle Production and Assembly

All trucks and busses, Class 1-8. 2005 2006 Growth Malaysia Ford/Nissan/Perodua/Proton/Toyota 158,837 125,096 -21.2% Malaysia Total 158,837 125,096 -21.2%

Mexico Dodge 186,745 153,890 -17.6% Mercedes Benz 27,821 29,591 6.4% Ford 32,423 37,190 14.7% Buick 59,485 53,599 -9.9% Cadillac 18,361 11,827 -35.6% Chevrolet 166,456 208,792 25.4% GMC 19,920 40,028 100.9% International 32,858 39,214 19.3% Kenworth 10,474 12,946 23.6% MAN 319 303 -5.0% Volvo Bus 590 833 41.2% t ion

Nissan 42,441 50,776 19.6% a Otros 113 135 19.5% t Scania 509 383 -24.8% Toyota 23,670 34,465 45.6% Volkswagen 1,004 1,308 30.3% Mexico Total 623,194 675,280 8.4%

Morocco (assembly)

Citroën/Fiat/Peugeot/Renault 12,829 12,194 -4.9% Transpor ay Morocco (assembly) Total 12,829 12,194 -4.9%

Netherlands DAF 40,528 43,420 7.1% Ginaf 140 186 32.9% Scania 22,000 25,700 16.8% Terberg 795 896 12.7%

vdl Bus International 1,240 1,110 -10.5% Global H i g h w BOVA 744 810 8.9% Netherlands Total 65,447 72,122 10.2%

Peoples Republic of China Isuzu/Other 328,502 373,593 13.7% Changan Suzuki/Other 453,289 179,936 -60.3% Changzheng/Huanghe/Other 42,066 59,610 41.7% Changhe/Suzuki 115,652 136,739 18.2% Changhe/Songhuajiang 175,367 196,894 12.3% Property of Dongfeng/Wukiang/OtherProperty 102,072 of 99,251 -2.8% Hongqi/Suzuki/Other 71,773 61,757 -14.0% JAC 90,421 115,314 27.5% JMC/Isuzu/Ford 68,837 77,846 13.1%

HDMA The 2009HDMA Global Commercial Vehicle Report 89 World Commercial Vehicle Production and Assembly

All trucks and busses, Class 1-8. 2005 2006 Growth Peoples Republic of China (continued) Iveco 58,618 58,207 -0.7% Isuzu 32,284 35,725 10.7% Wuling 38,407 38,877 1.2% Mitsubishi 13,482 7,765 -42.4% Other 186,200 605,080 225.0% Peoples Republic of China Total 1,776,970 2,046,594 15.2%

Poland Volkswagen 69,167 78,050 12.8% Fiat 13,872 26,651 92.1% Lublin 1,863 1,356 -27.2% Star 254 274 7.9%

Global H i g h w Poland Total 85,156 106,331 24.9%

Portugal Citroën/Peugeot (assembly) 21,144 23,368 10.5% Mitsubishi (assembly) 8,556 9,267 8.3% Isuzu (assembly) 1,925 2,214 15.0% Opel (assembly) 47,904 45,167 -5.7% Toyota (assembly) 3,929 3,831 -2.5% Portugal Total 83,458 83,847 0.5% ay Transpor

Romania Aro/Dacia/Daewoo/Rocar/Roman 20,264 11,934 -41.1% Romania Total 20,264 11,934 -41.1%

Russia (estimate) BMW/Kia/Hummer/Chevrolet/Cadillac/Great W 110 512 365.5% t a BAZ 55 92 67.3% t ion Mercedes, Aka,Ford 208 421 102.4% GAZ 165,358 185,316 12.1% Izhmach 7,220 12,267 69.9% KAMAZ 31,988 42,836 33.9% KAVZ 2,230 3,425 53.6% LIAZ 2,485 2,995 20.5% Other 5,120 5,856 14.4% PAZ 13,681 14,215 3.9% Hyundai 2,311 7,162 209.9% UAZ 32 53 65.6% UAZ 39,546 35,140 -11.1% Ural 7,683 9,952 29.5% VAZ Property3,569 of 3,379 -5.3% Volvo 362 397 9.7% ZIL 6,976 6,408 -8.1% Russia (estimate) Total 288,934 330,426 14.4%

90 The 2009 Global CommerHDMAcial Vehicle Report World Commercial Vehicle Production and Assembly

All trucks and busses, Class 1-8. 2005 2006 Growth South Africa Fiat 1,426 1,985 39.2% Mitsubishi 9,608 8,279 -13.8% Delta (GM) (Opel/Isuzu) 21,532 24,090 11.9% Ford 31,439 27,434 -12.7% Mazda 5,994 6,133 2.3% Hummer 0 725 MAN 2,178 2,511 15.3% Nissan 32,412 33,667 3.9% Nissan Diesel 3,374 4,102 21.6% Scania 822 814 -1.0% Toyota 58,396 97,742 67.4% International Harvester 832 989 18.9% Volkswagen 817 916 12.1% South Africa Total 169,804 209,387 23.3%

Spain t ion a

Opel 73,770 5,682 -92.3% t IVECO Pegaso 50,006 53,000 6.0% Mercedes Benz 75,181 76,586 1.9% Nissan (assembly) 166,505 142,062 -14.7% Citroën 256,830 158,036 -38.5% Peugeot 0 104,164 Renault (assenbly) 11,623 71,048 511.3%

Renault (assembly) 7,963 5,617 -29.5% Transpor ay Suzuki/Santana 12,454 8,681 -30.3% Spain Total 654,332 624,876 -4.5%

Sweden Volvo 24,080 26,604 10.5% Scania 10,841 12,155 12.1% Sweden Total 34,921 38,759 11.0%

Global H i g h w Taiwan Mitsubishi/Chrysler (assembly) 47,234 38,730 -18.0% Ford/Mazda (assembly) 26,198 21,885 -16.5% Toyota/Hino (assembly) 18,688 14,153 -24.3% Suzuki (assembly) 3,180 1,796 -43.5% Isuzu (assembly) 4,072 4,680 14.9% Nissan/Buick 23,154 10,679 -53.9% Taiwan Total 122,526 91,923 -25.0%

Property of Thailand (assembly)Property of Ford/Honda/Isuzu/Mitsubishi/Nissan/Opel/Toyo 845,277 895,084 5.9% Thailand (assembly) Total 845,277 895,084 5.9%

HDMA The 2009HDMA Global Commercial Vehicle Report 91 World Commercial Vehicle Production and Assembly

All trucks and busses, Class 1-8. 2005 2006 Growth Turkey Isuzu 6,762 7,445 10.1% Hino 2,439 1,309 -46.3% BMC 12,500 11,679 -6.6% Ford 243,423 258,126 6.0% Hyundai 28,618 18,545 -35.2% Peugeot 13,146 12,524 -4.7% MAN 2,030 2,501 23.2% Mercedes Benz 13,916 15,209 9.3% KHD/Land Rover 2,590 2,775 7.1% IVECO Fiat 3,634 4,165 14.6% Mitsubishi 8,161 8,915 9.2% Fiat 88,570 98,705 11.4%

Global H i g h w Turkey Total 425,789 441,898 3.8%

Ukraine (estimate) Bogdam 2,007 2,687 33.9% KRAZ 3,411 3,486 2.2% LUAZ 1,059 1,261 19.1% LAZ 449 555 23.6% Other 160 126 -21.3% Ukraine (estimate) Total 7,086 8,115 14.5% ay Transpor

United Kingdom Dennis Eagle 900 877 -2.6% Foden 0 264 Ford 71,885 70,890 -1.4% IBC 90,456 0 -100.0% LandRover 11,747 13,663 16.3% t a Leyland 16,277 16,954 4.2% t ion Leyland Daf Vans 10,175 6,990 -31.3% Nissan 0 13,354 Peugeot 3,097 3,803 22.8% Renault 0 36,524 Vauxhall/Opel 0 43,118 United Kingdom Total 206,753 206,437 -0.2%

United States Hummer 28,266 15,636 -44.7% BMW 104,986 65,876 -37.3% Chrysler 61,367 69,654 13.5% Dodge 683,720 630,692 -7.8% Jeep Property595,730 of 526,513 -11.6% Mercedes-Benz 95,558 173,600 81.7% Mitsubishi 9,631 4,546 -52.8% Ford 2,014,307 1,636,886 -18.7%

92 The 2009 Global CommerHDMAcial Vehicle Report World Commercial Vehicle Production and Assembly

All trucks and busses, Class 1-8. 2005 2006 Growth United States (continued) Lincoln 56,532 37,303 -34.0% Mazda 48,511 21,770 -55.1% Mercury 63,669 60,480 -5.0% Buick 38,368 19,802 -48.4% Cadillac 52,183 90,777 74.0% Chevrolet 1,327,197 1,132,007 -14.7% GMC 510,744 477,153 -6.6% Hummer 53,271 56,806 6.6% Isuzu 10,477 7,620 -27.3% Pontiac 48,798 29,210 -40.1% Saab 5,795 5,645 -2.6% Saturn 104,207 118,589 13.8% Acura 0 18,788 Honda 358,805 349,034 -2.7% Hyundai 0 61,618 t ion

Mitsubishi/Chrysler/Dodge 22,660 17,687 -21.9% a Toyota/Pontiac 168,927 170,765 1.1% t Nissan/Infiniti 452,759 395,865 -12.6% Subaru 27,481 21,022 -23.5% Toyota (assembly) 364,983 327,708 -10.2% Other 383,409 436,041 13.7% United States Total 7,692,341 6,979,093 -9.3%

Venezuela (assembly) Transpor ay Chrysler/Jeep/Mercedes 7,669 10,509 37.0% IVECO 2,167 3,074 41.9% Ford 18,681 15,603 -16.5% Chevrolet/GM/Isuzu/Suzuki 21,454 23,271 8.5% Mack 700 943 34.7% Mitsubishi/Hyundai 1,833 2,727 48.8% Toyota/Daihatsu 5,538 4,490 -18.9% Venezuela (assembly) Total 58,042 60,617 4.4% Global H i g h w

Sources: Compiled from various sources by Auto Strategies International Inc. primarily based on data from motor vehicle manufacturer associations in the respective countries.

May include double counting (vehicles counted as KDK and assembly). Property of Property of

HDMA The 2009HDMA Global Commercial Vehicle Report 93 China

With the opening of the Chinese economy and the move to a modern industrial infrastructure, freight transportation has exploded in China’s Truck Classifications and the past few decades. Vehicle Populations GVW UIO (millions) Similarly, truck transport has grown dramatically, but, as yet, Light Duty 1.8 to 6.0 metric tons 4.26 remains a niche transportation mode in China, one that is used primarily for short-haul routes with empty backhaul. One reason Medium Duty 6.1 to 14.0 metric tons 2.34 for this is that Chinese investment in the underlying transportation Heavy Duty Abobe 14 metric tons 1.54 infrastructure has failed to match the growth in transportation, and road quality remains poor in much of the country. At this time, Source: U.S. Department of Energy, Office of Scientific and Technical freight transportation by road is characterized by the use of gasoline Information powered light duty trucks, however, the Chinese government has mandated the shift to larger, more efficient diesel in an attempt to improve the energy profile of transportation.

Heavy Truck Sales in China Share of Trucks in Use 2004 370,795 2005 236,600 2006 307,300 2007 487,500 2008* 604,500

Source: China National Bureau of Statistics and CAAM * MEMA Forecast c hina

China’s Heavy Truck Sales

Source: U.S. Department of Energy, Office of Scientific and Technical Information

Source: China National Bureau of Statistics and CAAM * MEMA Forecast Property of

94 The 2009 Global CommerHDMAcial Vehicle Report China Overview measured at 42.7 percent of GDP, compared to 66.6 percent China’s population has shown a consistent annual growth rate of in 2006. 0.6 percent since 2003, reaching 1.31 billion in 2006. During the same period, China’s Gross Domestic Product (GDP) has grown by The country also has seen significant increases in foreign direct at least 10 percent each year. This equates to an increase of investment as net inflows have risen 58.4 percent from 2002 to $1 trillion over the four years as its GDP reached $2.6 trillion in 2006, settling at $78.1 billion. A likely contributor to this is the at- 2006. GDP climbed $881 per capita from 2002 to 2006. tractiveness of China’s emerging middle class, the demographic that is realizing a new consumer spending power for the first time in its China’s trade in merchandise goods continues to accelerate, helping modern history. to fuel its economic expansion. In 2002, merchandise trade was

China Economic Summary

2002 2003 2004 2005 2006 Population, total (billions) 1.28 1.29 1.30 1.30 1.31 Population growth (annual %) 0.7 0.6 0.6 0.6 0.6

GDP (current US$ billions) 1,453.8 1,641.0 1,931.7 2,243.9 2,644.7 GDP growth (annual %) 9.1 10.0 10.1 10.4 10.7 Inflation, GDP deflator (annual %) 0.6 2.6 6.9 4.2 3.6 GNI per capita, Atlas method (current US$) 1,100.0 1,270.0 1,500.0 1,740.0 2,000.0 GNI, Atlas method (current US$ billions) 1,406.8 1,631.4 1,938.0 2,275.7 2,621.0

Industry, value added (% of GDP) 44.8 46.0 46.2 47.5 48.4 Exports of goods and services (% of GDP) 25.1 29.6 34.0 37.3 40.1 Imports of goods and services (% of GDP) 22.6 27.4 31.4 31.7 32.2 Gross capital formation (% of GDP) 37.9 41.2 43.3 43.9 44.6

Merchandise trade (% of GDP) 42.7 51.9 59.8 63.4 66.6 c hina Foreign direct investment, net inflows (BoP, current US$ billions) 49.3 47.1 54.9 79.1 78.1 Long-term debt (DOD, current US$ billions) 120.5 120.4 131.9 133.3 149.5 Present value of debt (% of GNI) - - 14.5 14.2 - Total debt service (% of exports of goods, services and income) 8.3 7.3 3.4 3.1 2.5

Time required to start a business (days) - 48.0 48.0 48.0 35.0 Market capitalization of listed companies (% of GDP) 31.9 41.5 33.1 34.8 91.7 Roads, paved (% of total roads) 78.3 79.5 81.0 81.6 - High-technology exports (% of manufactured exports) 23.3 27.1 29.8 30.6 -

Source: World Development Indicators Database, May 2008 Property of Property of

HDMA The 2009HDMA Global Commercial Vehicle Report 95 China Engine Production 101-300 horsepower range grew 248.9 percent over the period. Pro- On-highway vehicle engine production reached an estimated duction of large diesel engines (301-700 horsepower) expanded in 4.6 million units in 2007, up 10 percent over 2006. The production 2007 as output reached 140,369, up 314.3 percent over 2006 levels. ratio of gasoline to diesel engines was split 70:30. Looking ahead, total engine production is forecast to rise slightly Chinese engine production increased 54 percent from 2002 to 2007, to 4.7 million units in 2008. Of these, 1.7 million will be 51-100 driven primarily by gasoline engine manufacturing. Engines in the horsepower gasoline engines.

China Engine Production for On Highway Vehicles

Diesel 2002 2003 2004 2005 2006 2007E 2008F 0-50 hp 181,443 194,824 244,126 35,507 34,561 37,719 19,947 51-100 hp 371,135 420,968 439,989 405,934 434,430 500,971 472,763 101-300 hp 500,230 597,493 663,645 483,178 599,704 715,664 710,645 301-700 hp 33,882 71,366 102,682 41,315 59,797 140,369 155,758 Total Diesel 1,086,690 1,284,651 1,450,442 965,934 1,128,492 1,394,723 1,359,113

Gas/Gasoline 2002 2003 2004 2005 2006 2007E 2008F 0-50 hp 365,830 406,574 460,005 426,278 451,208 481,765 555,777 51-100 hp 1,210,003 1,390,054 1,759,038 1,423,085 1,543,011 1,615,786 1,660,609 101-300 hp 313,016 583,218 863,871 967,657 1,044,362 1,091,918 1,116,040 301-700 hp ------Total Gas 1,888,849 2,379,846 3,082,914 2,817,020 3,038,581 3,189,469 3,332,426 c hina Grand Total 2,975,539 3,664,497 4,533,356 3,782,954 4,167,073 4,584,192 4,691,539

Source: Power Systems Research

Property of

96 The 2009 Global CommerHDMAcial Vehicle Report Russia

Russia has grown from a struggling minor player in the world that has averaged 7% per year. Granted, the high oil prices and the economy to the tenth largest in terms of purchasing power. This value of the ruble initiated this growth, but consumer demand, and growth was facilitated by its stable politics, predictable economic new investment activity, have recently played a major part as well. growth and firm state control over natural resources. The fact that it Fixed capital investments have averaged real gains greater than is the second largest oil producer and the top producer of natural gas 10% per year for six years, while personal income has increased by has helped considerably, especially with the global growth in energy an average of just over 12% annually. In this time, Russia has been consumption and high oil prices. able to decrease the amount of poverty and has continued to increase the size of its middle class. With a labor force of approximate- The Russian economy grew to just over $2 trillion (GDP purchasing ly 74 million workers, Russia’s unemployment rate was estimated at power parity) in 2007. This was the ninth straight year of growth 6.2% at the end of 2007.

Russia Key Economic Indicators and Forecasts

2007 2008 2009 2010 2011 2012 Real GDP growth (%) 8.1 7.4 6.5 6.0 5.5 5.0 Inflation - consumer prices (av; %) 9.0 14.1 11.5 9.4 7.6 7.1 Budget balance (% of GDP) 5.4 4.5 3.3 2.2 1.7 1.1 Current-account balance (% of GDP) 6.1 6.1 3.5 2.3 1.6 0.9 Central bank refinancing rate (end-period; %) 10.0 11.3 10.0 9.0 8.0 7.5 Exchange rate Rb:US$ (av) 25.6 24.1 24.5 25.3 26.0 26.5 Exchange rate Rb:€(av) 35.0 37.1 37.2 36.7 35.6 35.0

Source: The Economist

Road Transportation in Russia Heavy Duty Truck Market in Russia Road transport in Russia is responsible for moving approximately The Russian market for heavy duty trucks amounted to 128,000 17 million tons of freight per day, about six times then the volume vehicles in 2007, and the expectation is that the market will have moved by rail. In 2006, trucks moved more than 136 billion ton- grown by another 14%, reaching 146,000 heavy duty trucks in 2008. r u ssia miles of freight, supporting the economy while providing employment for more than four million people who were employed in road transport operations. Russian Heavy Duty Truck Sales (1,000)

Transportation by road has provided the necessary mobility that was 2007 2008* Growth a requisite for Russia’s economic growth in the last decade. Unfor- New 103 118 15% tunately, the nature and condition of the domestic truck fleet, road Used 25 28 12% conditions, and the level of highway infrastructure development do Total 128 146 14% not reflect the level of dependence Russia has on the sector. The existing road transportation system barely meets the growing demand for its services, and although tasked with enhancing Rus- US Share of Used Truck Sales in Russia sian interests in international trade, serious shortcomings encumber 24% 46% operations. The Russian government is attempting to address some of the problems and to modernize the transportation system. * = projection HDMA Estimates

Russia’s Road Transportation System at a Glance • Trucks and Busses in Operation 5,538,672 Russian Truck Manufacturers • Road Freight Transport (million ton/miles) 136,144 There are four predominant truck manufacturers in Russia. The largest is GAZ, with a strong presence in the light commercial Property of • Miles of Roadway Property 530,651 vehicleof segment, but second in heavy duty trucks with about 11% • Miles of Paved Roads (85%) 448,630 share. The second largest is KAMAZ, the leader in the heavy duty • Miles of Expressway 18,020 segment with a 30% share of market. The other two, Sollers (mostly light commercial vehicles) and ZIL (medium duty trucks) are not significant participants in the heavy duty truck segment.

HDMA The 2009HDMA Global Commercial Vehicle Report 97 Most domestic vehicle manufacturers actively import key compo- Russian Truck Sales and Forecast by GVW nents for their truck production, and there is significant pressure on foreign suppliers to establish manufacturing facilities in Russia, (Thousands) 2000 2005 2010* 2015* with an aim towards cutting costs. According to KAMAZ, a lead- Up to 3.5t 136 152 204 275 ing heavy duty truck manufacturer, the company’s global suppliers 3.5 to 9t 20 27 39 50 provide a broad range of parts and components. 9 to 12t 9 9 10 12 According to KAMAZ, these include: 12 to 18t 20 35 31 38 l Transmissions and clutches from ZF 18 to 20t 8 7 9 9 l Engines from Cummins 20 to 26t 21 23 23 28 l Filters from Mann Hummel Over 26t 1 3 4 5 l Piston rings from Federal Mogul Total 215 256 320 417 l Fuel injection pumps from Bosch l Brake systems from Wabco, Knorr * = forecast l Fan clutches from Borg Warner Source: Association of Automotive Producers and HDMA estimates

Russian Truck Mix by GVW Share of Trucks in Use r u ssia

Source: U.S. Department of Energy, Office of Scientific and Technical Information

Note: 1 Metric ton (t) = 2,205 lbs.

Property of

98 The 2009 Global CommerHDMAcial Vehicle Report Brazil

Brazil is the largest and most populous nation in Latin America, and, like France and Belgium, based on figures reported by the Foreign based on CIA World Factbook data, has over one million miles of Trade Division and U.S. Census Bureau. roads, rich mineral resources and a population growing 50% faster For the transportation sector, Brazil ranks eighth largest as a destina- than that of the United States. All of these factors make Brazil an tion for exports. The penetration of American products into the important market for American products. In 2007, $24.6 billion was Brazilian market is minimal for the road transportation sub-segment. imported by Brazil from the United States. That total was surpassed Consisting of vehicles, parts, trailers and bodies, only 9.6% of in the first three quarters of 2008, putting total exports to Brazil on transportation product dollars exported to Brazil are for this group of pace to eclipse $34.5 by year end. This makes Brazil the ninth larg- on-road products. By contrast, 51.4% of US transportation exports est purchaser of American products, beating out traditional partners as a whole are in the on-road segment.

Value of Motor Vehicle Exports to Brazil

In millions of US Dollars brazil

Source: Foreign Trade Division, U.S. Census Bureau.

Distribution of 2008 Transportation Sector Exports

All Exports (World) and Brazil

Property of Property of

Source: Foreign Trade Division, U.S. Census Bureau.

HDMA The 2009HDMA Global Commercial Vehicle Report 99 The production of heavy trucks in Brazil has surpassed the 100,000 New registrations for trucks and buses were 76,258 and 19,768 units mark for three consecutive years (2004 through 2006) based on respectively in 2006, an increase of only 0.34% over 2005, and down Brazilian Automotive Industry Yearbook, 2007. Annual bus produc- 4.6% compared to 2005 new registrations. This dip in registrations tion was over 30,000 units, bringing total heavy vehicle production is largely due to the surge in 2005 of nearly 20 thousand units rather for 2006 to 139,810. than a weakness of recent years. The overall growth is being maintained through the recent peaks and valleys. In 2006, there was an estimated 1.4 million trucks on the roads of Brazil, out of a total vehicle population of about 24 million. Ve- The larger number of units produced as compared to registrations hicles listed as light commercial vehicles, or light trucks, including creates an opportunity for Brazilian manufacturers. Exports by the SUVs are just twice the number of heavy trucks. The bus fleet of motor vehicle industry of Brazil have grown by 184% in the last de- 386,000 is expected to rise based on new registrations that have cade, to peak at almost 900, 000 units shipped. Heavy truck exports increased by 22% in the last decade as compared to the previous in 2006 were 447% of the 1996 level, reporting 38,188 units shipped ten years. in 2006. Bus exports were just under 16,000 units in 2006, down from the record 18,969 in 2005, but still and increase of over 200% versus 1996.

Annual New Heavy Vehicle Registrations brazil

Source: ANFAVEA - Anuário da Indústria Automobilística Brasileira / Brazilian Automotive Industry Yearbook, 2007

Heavy Vehicle Production in Brazil by Year

Property of

Source: ANFAVEA - Anuário da Indústria Automobilística Brasileira / Brazilian Automotive Industry Yearbook, 2007

100 The 2009 Global CommerHDMAcial Vehicle Report Heavy Vehicle Registrations by Vehicle Type

Brazilian Motor Vehicle Fleet Composition

Tonnes Pounds Semi-light GVW 3.5 - 6 7,716 - 13,227 Light GVW 6 - 10 13,228 - 22,046

Source: ANFAVEA - Anuário da Indústria Automobilística Brasileira / Brazilian Medium GVW 10 - 15 22,047 - 33,069 Automotive Industry Yearbook, 2007 Semi-heavy GCW* < 40 < 88184 Heavy GCW* > 40 > 88184

* For tractors. Fixed chassis are 5t higher

Source: ANFAVEA - Anuário da Indústria Automobilística Brasileira / Brazilian Automotive Industry Yearbook, 2007

Three Decades of Brazilian Heavy Vehicle Exports brazil

Property of Property of Source: ANFAVEA - Anuário da Indústria Automobilística Brasileira / Brazilian Automotive Industry Yearbook, 2007

HDMA The 2009HDMA Global Commercial Vehicle Report 101 India

Beginning in the early 1990s, India’s growing economy has witnessed Economy a 10% annual increase in demand for a transport infrastructure; It is estimated that the population of India reached 1.13 billion in unfortunately, development has not kept pace with this demand 2007, the second largest of any country. Though China boasts the growth. Major improvements in transportation infrastructure are highest number of residents, India’s annual population growth has a prerequisite for India’s continued economic growth. Roads carry consistently doubled that of China in recent years, measuring 1.4% about 65% of its freight, but one quarter of all India’s highways are in 2007. so congested that truck speeds are held between 20 to 25 miles per hour, and rush-hour speeds average less than 10 miles an hour in the India’s Gross Domestic Product (GDP) grew to $983 billion in 2007, central areas of Mumbai and other metropolitan areas. representing a 7.8% rise over 2006 and the fifth straight year of GDP growth above 7%. Inflation has abated somewhat to 4.5% compared Furthermore, most roads are of poor quality, and 40% of India’s rural to 5.9% in 2006. villages do not have access to all-weather roads and remain cut-off during the monsoon season during the summer months.

India’s Transportation Infrastructure Length of Roads 2,185,022 miles Main Roads 4,141,143 miles Paved Roads 47% Access to All-Season-Roads 61%

Rail Track Length 39,350 miles

india India Economic Summary

2007 2008 2009 2010 2011 2012 2002 2003 2004 2005 2006 2007* Population, total (billions) 1.05 1.06 1.08 1.09 1.11 1.13 Population growth (annual %) 1.6 1.5 1.4 1.4 1.4 1.4

GDP (current US$ billions) 507.8 601.8 695.8 805.7 911.8 983.0 GDP growth (annual %) 3.7 8.4 8.3 9.2 9.2 7.8 Inflation, GDP deflator (annual %) 3.9 3.8 4.4 4.4 5.9 4.5

Industry, value added (% of GDP) 26.4 26.2 27.5 27.6 27.9 27.1 Exports of goods and services (% of GDP) 15.3 15.5 18.2 20.3 23.0 18.5 Imports of goods and services (% of GDP) 15.7 16.1 20.0 23.3 25.8 20.2 Gross capital formation (% of GDP) 25.6 27.5 31.0 33.4 33.9 30.2

Merchandise trade (% of GDP) 20.8 21.3 25.3 29.6 32.4 25.9 Foreign direct investment, net inflows (BoP, current US$ billions) 5.6 4.6 5.8 6.7 17.5 8.0 Long-term debt (DOD, current US$ billions) 100.9 107.8 116.9 114.3 141.1 167.9 Total debt service (% of exports of goods, services and income)Property 17.3 of19.1 13.8 13.2 7.7

Source: World Development Indicators database, May 2008 * HDMA Estimate

102 The 2009 Global CommerHDMAcial Vehicle Report Medium and Heavy Duty Trucks and Busses the current global economic situation has also been felt in India, Like many newly emerging countries, India’s highway infrastructure and medium and heavy commercial vehicles are suffering from a promotes the use of light commercial vehicles. However, its large lack of demand for goods transport, drop in road freight rates and manufacturing base and export markets create the need to use larger, high financing costs. As a result, Tata Motors, by far India’s largest more efficient trucks to move goods from the production centers to truck maker, has already had to cut production at its plants to avoid the port facilities. Despite the lack of rural infrastructure, India is a buildup in inventories, while Ashok Leyland, India’s second- one of the world’s largest truck markets and, until the last half of largest commercial vehicle maker, had likewise cut shifts in the last 2008, projections were for continued long-term growth. However, quarter of 2008.

Trucks

India Medium and Heavy Truck India Medium and Heavy Truck Production and Growth Sales and Growth 2006 2007 Change 2006 2007 Change Volvo Truck 606 806 33.0% Volvo Truck 610 802 31.5% Mazda 4,127 4,235 2.6% Mazda 4,297 3,935 -8.4% Eicher Motors 17,013 21,461 26.1% Eicher Motors 16,648 20,023 20.3% Ashok Leyland 62,991 59,876 -4.9% Ashok Leyland 60,384 57,424 -4.9% Tata 161,594 157,162 -2.7% Tata 150,580 148,371 -1.5% TOTAL 246,331 243,540 -1.1% TOTAL 232,519 230,555 -0.8%

Source: Ward’s Automotive Reports Source: Ward’s Automotive Reports

India Medium and Heavy Truck India Medium and Heavy Truck Production Shares (2007) Share of Sales (2007) india

Source: Ward’s Automotive Reports Source: Ward’s Automotive Reports Property of Property of

HDMA The 2009HDMA Global Commercial Vehicle Report 103 Busses

India Bus Production and Growth India Bus Sales and Growth 2006 2007 Change 2006 2007 Change Volvo Truck 290 175 -39.7% Volvo Truck 248 229 -7.7% Mazda 1,549 2,649 71.0% Mazda 1,439 1,967 36.7% Eicher Motors 1,404 2,179 55.2% Eicher Motors 1,388 1,816 30.8% Ashok Leyland 14,510 22,530 55.3% Ashok Leyland 11,064 17,749 60.4% Tata 12,546 16,896 34.7% Tata 14,785 15,576 5.4% TOTAL 30,299 44,429 46.6% TOTAL 28,924 37,337 29.1%

Source: Ward’s Automotive Reports Source: Ward’s Automotive Reports

India Bus Production Shares (2007) India Bus Share of Sales (2007) india

Source: Ward’s Automotive Reports Source: Ward’s Automotive Reports

Property of

104 The 2009 Global CommerHDMAcial Vehicle Report Engine Production line engine production. The majority of diesel engine production India’s on-highway vehicle engine production increased to an was split between the 101-300 (46.7%) horsepower and estimated 1.8 million units in 2007, up 5.7% compared to 2006. The 51-100 horsepower (43.8%) ranges. split of gasoline to diesel engine production was 60:40. Forecasts indicate that India’s engine production will be stepped The majority of gasoline engines manufactured in India were in the up again in 2008 by 1.7%, the lowest increase in recent history. An 51-100 horsepower range, accounting for 58.4% (642,290 units). estimated 1.9 million engines are expected to be manufactured, with Engines in the 0-50 horsepower range made up 40.7% of total gaso- the only reduction among 101-300 horsepower diesel engines (down 3%).

India Engine Production for On Highway Vehicles

Diesel 2002 2003 2004 2005 2006 2007E 2008F 0-50 hp 14,583 12,885 14,159 27,274 52,793 69,491 71,440 51-100 hp 234,619 252,701 261,941 287,487 291,999 323,811 329,236 101-300 hp 99,513 109,451 114,696 283,428 329,013 345,460 335,001 301-700 hp - - 141 187 225 554 586 Total Diesel 348,715 375,037 390,937 598,376 674,030 739,316 736,263

Gas/Gasoline 2002 2003 2004 2005 2006 2007E 2008F 0-50 hp 411,875 425,881 436,610 398,214 433,761 447,336 461,338 51-100 hp 369,562 511,650 591,461 573,005 623,188 642,290 662,052 101-300 hp 14,909 18,227 19,162 8,542 9,237 9,839 9,932 301-700 hp ------Total Gas 796,346 955,758 1,047,233 979,761 1,066,186 1,099,465 1,133,322

Grand Total 1,145,061 1,330,795 1,438,170 1,578,137 1,740,216 1,838,781 1,869,585

Source: Power Systems Research india

India’s Light Duty Backdrop country’s total. The company’s sales growth has been strong with In India, 30% of light vehicle production and 32% of light vehicle an average annual growth rate of 15% from 2003 to 2006. Forecasts sales are trucks, and very few of these are SUVs or pickups and vans indicate that Suzuki’s accelerated sales pace will slow in the coming that are used for personal transportation. These are truly commer- years, growing an average of 5.8% annually from 2006 to 2011. cial vehicles, and dramatically impact the demand for medium and heavy duty trucks. It is therefore relevant when accessing the heavy Hyundai-Kia Automotive placed second on the sales list with duty market to examine the light vehicle sector. 186,174 units delivered, 19.1% higher than the year prior. Honda Motor Co. was next with 56,184 units purchased. The “Other” cat- Light Vehicle Sales egory was responsible for 470,709 units sold. This category includes A total of 1.5 million light vehicles were sold in India in 2006, companies with traditionally high sales, including former second up 20.8% compared to 2005’s total of 1.2 million. Looking ahead, place Tata Motors Ltd. and the former number four, Mahindra & India’s light vehicle sales are expected to increase an average of 11% Mahindra. Specific volumes of these companies were unavailable at a year, reaching 2.4 million in 2011. the time of this publication.

Suzuki Motor Corp. dominates India’s new light vehicle market, with 2006 sales figures reaching 596,005 units or 40.9% of the Property of Property of

HDMA The 2009HDMA Global Commercial Vehicle Report 105 India Vehicle Sales History and Forecast by Manufacturer

2003 2004 2005 2006 2007 2008 2009 2010 2011 forecast forecast forecast forecast forecast BMW Group – – – – 1367 1786 1,994 2,171 2,599 DaimlerChrysler AG 1,497 1,727 1,799 1,849 2,606 2,799 2,983 3,523 4,051 Fiat Group 11,909 6,706 2,130 2,028 2,160 8,802 9,472 10,414 11,070 Ford Motor Co. 18,987 27,161 22,385 42,061 51,192 40,288 34,515 39,631 50,226 General Motors 15,155 26,166 30,837 35,828 55,209 68,106 69,949 68,557 79,823 Honda Motor Co. 16,721 35,354 40,579 56,184 71,325 72,992 116,418 129,704 140,979 Hyundai-Kia Automotive 120,291 139,629 156,269 186,174 224,672 256,596 244,560 255,588 277,298 Mitsubishi Motors Corp. 3,042 2,620 1,788 3,778 6,086 7,462 7,734 8,579 9,060 Renault-Nissan – – 119 189 717 12,145 20,325 27,219 27,429 Suzuki Motor Corp. 392,177 479,548 516,712 596,005 661,861 669,578 702,435 718,125 789,543 Toyota Motor Co. 39,916 47,123 42,022 48,468 77,740 118,196 126,923 211,933 227,240 Volkswagen AG 5,527 7,206 8,953 12,327 14,381 22,788 28,580 36,623 41,081 Other 279,142 344,821 381,771 470,709 495,288 577,502 679,328 731,525 788,359 Total 904,364 1,118,061 1,205,364 1,455,600 1,664,604 1,859,040 2,045,216 2,243,592 2,448,758

Note: Reflects passenger car and light commercial vehicles; excludes medium and heavy trucks and buses; forecast data (2007-2011) based on 2007 first-quarter projections

Source: Automotive News Europe and J.D. Power Automotive Forecasting india

India Vehicle Sales History and Forecast 2006 India Sales by Manufacturer – Top 10

Source: Automotive News Europe and J.D. Power Automotive Forecasting Source: Automotive News Europe and J.D. Power Automotive Forecasting

Light Vehicle Production growth will slow to an average annual rate of 6.9% until reaching In 2006, more than 1.6 million light vehicles were manufactured in 877,735 assembled units in 2011. India. Production has stepped up in the country, growing an average of 17.7% from 2003 to 2006. Moving forward, annual production is Hyundai-Kia automotive placed second on the list of top produc- expected to grow anProperty average of 12.5% per year until reaching 3 mil- ers inof India with 301,289 vehicles assembled in 2006, while Honda lion vehicles in 2011. was next with 54,429 units. As with sales, some manufacturers have been lumped into the “Other” category, including Telco and Ma- Suzuki Motor Corp. produced 628,355 vehicles in India in 2006, the hindra & Mahindra, the former second and fourth place producers most of any manufacturer. Since 2003, the company’s production has respectively. increased an average of 12.8% each year. Looking ahead, production

106 The 2009 Global CommerHDMAcial Vehicle Report India Vehicle Production History and Forecast by Manufacturer

2003 2004 2005 2006 2007 2008 2009 2010 2011 forecast forecast forecast forecast forecast BMW Group – – – – 1,182 1,611 1,782 1,875 2,157 DaimlerChrysler AG 1,396 1,777 1,775 1,951 2,329 2,558 2,647 3,095 3,430 Fiat Group 12,979 8,078 3,330 1,990 1,881 8,089 8,701 9,615 10,157 Ford Motor Co. 18,790 27,266 22,652 40,644 49,660 40,374 34,481 39,345 48,917 General Motors 14,482 26,124 29,398 37,832 50,547 66,267 66,959 64,708 74,012 Honda Motor Co. 15,737 34,535 38,570 54,429 64,876 69,061 111,652 124,341 134,429 Hyundai-Kia Automotive 153,600 216,592 250,703 301,289 430,670 543,917 538,189 574,836 596,534 Mitsubishi Motors Corp. 3,528 2,805 2,991 4,494 4,116 5,892 6,266 7,111 7,332 Renault-Nissan – – – – – 18,807 57,921 98,904 108,882 Suzuki Motor Corp. 437,507 537,727 555,315 628,355 690,834 738,316 798,220 813,745 877,735 Toyota Motor Co. 37,481 47,628 45,695 44,310 74,984 117,795 127,025 211,693 224,167 Volkswagen AG 1,916 7,050 8,455 12,544 15,519 23,241 28,952 36,949 41,023 Other 311,028 395,747 430,918 514,969 538,141 627,841 727,847 778,291 833,303 Total 1,008,444 1,305,329 1,389,802 1,642,807 1,924,739 2,263,769 2,510,642 2,764,508 2,962,078

Note: Reflects passenger car and light commercial vehicles; excludes medium and heavy trucks and buses; forecast data (2007-2011) based on 2007 first-quarter projections

Source: Automotive News Europe and J.D. Power Automotive Forecasting

India Vehicle Production History and Forecast 2006 India Production by Manufacturer – Top 10 india

Source: Automotive News Europe and J.D. Power Automotive Forecasting Source: Automotive News Europe and J.D. Power Automotive Forecasting

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HDMA The 2009HDMA Global Commercial Vehicle Report 107 Methodology

Fleet Survey Distributor Survey The fleet study is based on data collected from three separate The distributor study was conducted using a commercial on-line samples of fleets and owner/operators. Maintenance and purchasing survey service. The total invited sample pool consisted of individu- practices were obtained from survey data and used to construct a als from 283 heavy duty distributors who were invited to participate. profile of the business type and, where appropriate, compared to data Each was sent an e-mail invitation with a hyperlink that would open collected in previous studies. Specific information was gathered on a web browser and begin the automated survey presentation. No in- individual heavy duty trucks, Class 6, 7 and 8. Both gasoline and centive was offered for taking the survey. The survey was completed diesel powered vehicles with a GVW of greater than 19,501 pounds by 77 representatives of distributor operations from the total invited were included in the analysis. Trucks not in actual use at the time sample for a survey response rate of 27.2%. the information was gathered were not included in the sample or the universe estimates. Sampling All estimates are based on a sample survey and will differ from the The survey was conducted using direct phone interviews and self real universe because of sampling variability, non-sampling error, administered web-based Internet survey tools. A drawing for $500 and non-response error. Sampling variability is that error due to not was offered, the winner to be selected from among the survey par- measuring the entire universe. Non-sampling errors are those errors ticipants. The overall in tab sample for the three portions was 210. due to the methodology, coding, and reporting of the survey results. Every effort has been taken to minimize error from these sources Not included in these estimates is a significant portion of the vehicle within the time and budget limitations of the study. For more infor- population operated by the federal government and the military mation, contact Frank H. Hampshire, Senior Director of Research, as well as the various local and state governments. Also excluded the Motor & Equipment Manufacturers Association. from the study are buses (of all types), equipment (including heavy equipment, agricultural machinery, material handling equipment, and unregistered road vehicles), and those new and used vehicles at dealerships or otherwise not in service. me t hodolo g y

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108 The 2009 Global CommerHDMAcial Vehicle Report Acknowledgments

THE EDUCATIONAL AND RESEARCH FOUNDATION OF MEMA, INC. The Educational and Research Foundation of MEMA, Inc., was established by the association in 1983 to provide and promote research work and educational projects to benefit the automotive and heavy duty industries and their consumers.

Foundation-published research projects have included studies of consumer car and truck maintenance practices and buying preferences, detailed reports and analyses of the industry distribution systems and studies of what factors influence consumer purchase decisions.

Tax-deductible contributions may be made to the foundation to support its research and educational work for the industry and U.S. motorists.

MARKINETICS, INC. The survey fielding and data entry for fleet maintenance section of this study was done by Markinetics, Inc. They were also responsible for arranging for the survey to be available on several Internet web sites. Markinetics provides a wide range of marketing-related services including research, strategic planning, integrated marketing communications and training. Researchers assist companies in finding new markets, better penetrating existing markets, new product development, creating effective promotions and improving sales and distribution. Research methods available include expert interviews, focus groups, personal intercepts, computerized interviews, web research, telephone interviewing, trade show research, and self- administered surveys. Markinetics Inc. is in Marietta, OH and can be reached at 800-552-2510.

A C KNO W LED G EMEN T S

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HDMA The 2009HDMA Global Commercial Vehicle Report 109 Appendix

DATA TABLES FROM FLEET SURVEY

Number of class 6, 7 and 8 vehicles in fleet. Average miles per year heavy duty vehicles are driven. Owner-Operators 19.6 For Hire/Common Carrier 241.3 Owner-Operators 98,213 Private Fleet 244.7 For Hire/Common Carrier 109,617 Agriculture, Mining, Oil-field. Forestry 63.0 Private Fleet 84,680 Production and Distribution of Goods 390.5 Agriculture, Mining, Oil-field. Forestry 100,395 Construction 26.3 Production and Distribution of Goods 65,010 Utility and All Other 117.2 Construction 81,450 All Fleet Types Combined 243.0 Utility and All Other 90,429 All Fleet Types Combined 97,504

Total pieces of motorized equipment maintained. Average heavy duty vehicle life (years).

Owner-Operators 35.8 Owner-Operators 9.9 For Hire/Common Carrier 266.4 For Hire/Common Carrier 8.9 Private Fleet 385.7 Private Fleet 11.1 Agriculture, Mining, Oil-field. Forestry 57.9 Agriculture, Mining, Oil-field. Forestry 12.4 Production and Distribution of Goods 481.5 Production and Distribution of Goods 10.7

APPENDIX Construction 117.8 Construction 10.2 Utility and All Other 313.3 Utility and All Other 11.0 All Fleet Types Combined 303.8 All Fleet Types Combined 10.0

Total number of trailers owned or operated. Average heavy duty vehicle life (miles).

Owner-Operators 31.4 Owner-Operators 688,429 For Hire/Common Carrier 94.1 For Hire/Common Carrier 862,500 Private Fleet 163.2 Private Fleet 540,671 Agriculture, Mining, Oil-field. Forestry 19.8 Agriculture, Mining, Oil-field. Forestry 641,667 Production and Distribution of Goods 581.7 Production and Distribution of Goods 515,294 Construction 23.2 Construction 452,350 Utility and All Other 55.0 Utility and All Other 547,083 All Fleet Types Combined 96.2 All Fleet Types Combined 697,200

Average cost per mile for maintenance (Class 8, excluding fuel costs).

Owner-Operators $0.18 For Hire/Common Carrier $0.15 Private Fleet $0.17 Property Agriculture, Mining, Oil-field. of Forestry $0.18 Production and Distribution of Goods $0.14 Construction $0.27 Utility and All Other $0.20 All Fleet Types Combined $0.17

110 The 2009 Global CommerHDMAcial Vehicle Report Geographical range of operation.

Local Regional Long Haul Owner-Operators 50.0% 30.0% 20.0% For Hire/Common Carrier 27.1% 37.1% 35.7% Private Fleet 61.4% 32.9% 5.7% Agriculture, Mining, Oil-field. Forestry 61.9% 33.3% 4.8% Production and Distribution of Goods 47.1% 41.2% 11.8% Construction 70.0% 30.0% 0.0% Utility and All Other 66.7% 25.0% 8.3% All Fleet Types Combined 46.2% 33.3% 20.5%

Logistical range of operation.

Truckload Less than Truckload Owner-Operators 85.7% 14.3% For Hire/Common Carrier 71.4% 28.6% Private Fleet 77.1% 22.9% Agriculture, Mining, Oil-field. Forestry 85.7% 14.3% Production and Distribution of Goods 64.7% 35.3% Construction 70.0% 30.0% Utility and All Other 91.7% 8.3% All Fleet Types Combined 78.1% 21.9%

Outside Service Performed at a Truck Stop?

Yes No Owner-Operators 32.9% 67.1%

For Hire/Common Carrier 41.4% 58.6% APPENDIX Private Fleet 15.7% 84.3% Agriculture, Mining, Oil-field. Forestry 14.3% 85.7% Production and Distribution of Goods 23.5% 76.5% Construction 5.0% 95.0% Utility and All Other 25.0% 75.0% All Fleet Types Combined 30.0% 70.0%

Outside Service Performed at a General Repair Shop?

Yes No Owner-Operators 62.9% 37.1% For Hire/Common Carrier 68.6% 31.4% Private Fleet 70.0% 30.0% Agriculture, Mining, Oil-field. Forestry 85.7% 14.3% Production and Distribution of Goods 52.9% 47.1% Property of ConstructionProperty of85.0% 15.0% Utility and All Other 41.7% 58.3% All Fleet Types Combined 67.1% 32.9%

HDMA The 2009HDMA Global Commercial Vehicle Report 111 Outside Service Performed at a Truck Dealer?

Yes No Owner-Operators 60.0% 40.0% For Hire/Common Carrier 74.3% 25.7% Private Fleet 81.4% 18.6% Agriculture, Mining, Oil-field. Forestry 76.2% 23.8% Production and Distribution of Goods 76.5% 23.5% Construction 90.0% 10.0% Utility and All Other 83.3% 16.7% All Fleet Types Combined 71.9% 28.1%

Operations with in-house maintenance capabilities for most preventative maintenance tasks.

Yes No Owner-Operators 100.0% 0.0% For Hire/Common Carrier 98.6% 1.4% Private Fleet 100.0% 0.0% Agriculture, Mining, Oil-field. Forestry 100.0% 0.0% Production and Distribution of Goods 100.0% 0.0% Construction 100.0% 0.0% Utility and All Other 100.0% 0.0% All Fleet Types Combined 99.5% 0.5% APPENDIX

Operations with in-house maintenance capabilities for most minor repairs.

Yes No Owner-Operators 100.0% 0.0% For Hire/Common Carrier 97.1% 2.9% Private Fleet 100.0% 0.0% Agriculture, Mining, Oil-field. Forestry 100.0% 0.0% Production and Distribution of Goods 100.0% 0.0% Construction 100.0% 0.0% Utility and All Other 100.0% 0.0% All Fleet Types Combined 99.0% 1.0%

Operations with a fully equipped machine shop. Yes No Owner-Operators 34.3% 65.7% For Hire/Common Carrier 32.9% 67.1% Private Fleet 27.1% 72.9% Agriculture, Mining, Oil-field. Forestry 23.8% 76.2% Production and Distribution of Goods 23.5% 76.5% ConstructionProperty of30.0% 70.0% Utility and All Other 33.3% 66.7% All Fleet Types Combined 31.4% 68.6%

112 The 2009 Global CommerHDMAcial Vehicle Report Value of in-house parts inventory.

Less than $11,000 to $51,000 to More than $10,000 $50,000 $100,000 $100,000 Owner-Operators 68.6% 28.6% 1.4% 1.4% For Hire/Common Carrier 51.4% 27.1% 14.3% 7.1% Private Fleet 44.3% 35.7% 7.1% 12.9% Agriculture, Mining, Oil-field. Forestry 50.0% 40.9% 4.5% 4.5% Production and Distribution of Goods 29.4% 41.2% 5.9% 23.5% Construction 50.0% 25.0% 15.0% 10.0% Utility and All Other 41.7% 33.3% 8.3% 16.7% All Fleet Types Combined 54.8% 30.5% 7.6% 7.1%

Purchasing behavior when specified brand is not available from a supplier.

Take the next Get it from Wait for the part available brand a different supplier Owner-Operators 35.7% 32.9% 31.4% For Hire/Common Carrier 38.6% 35.7% 25.7% Private Fleet 40.0% 38.6% 21.4% Agriculture, Mining, Oil-field. Forestry 38.1% 33.3% 28.6% Production and Distribution of Goods 52.9% 35.3% 11.8% Construction 30.0% 45.0% 25.0% Utility and All Other 41.7% 41.7% 16.7% All Fleet Types Combined 38.1% 26.2% 35.7%

Change in outsourced maintenance and repair in the next three years.

More Less About the Same APPENDIX Owner-Operators 21.4% 20.0% 58.6% For Hire/Common Carrier 20.0% 18.6% 61.4% Private Fleet 20.0% 27.1% 52.9% Agriculture, Mining, Oil-field. Forestry 19.0% 33.3% 47.6% Production and Distribution of Goods 11.8% 41.2% 47.1% Construction 35.0% 15.0% 50.0% Utility and All Other 8.3% 16.7% 75.0% All Fleet Types Combined 20.5% 21.9% 57.6%

Operations with trucks on order. Yes No Owner-Operators 2.9% 97.1% For Hire/Common Carrier 7.1% 92.9% Private Fleet 12.9% 87.1% Agriculture, Mining, Oil-field. Forestry 9.5% 90.5% Property of ProductionProperty and Distribution of Goods of17.6% 82.4% Construction 10.0% 90.0% Utility and All Other 16.7% 83.3% All Fleet Types Combined 7.6% 92.4%

HDMA The 2009HDMA Global Commercial Vehicle Report 113 Of those with new trucks on order, Average number of new trailers planning to average number on order. purchase or lease in the next 12 months.

Owner-Operators 7.5 Owner-Operators 15.0 For Hire/Common Carrier 44.2 For Hire/Common Carrier 43.4 Private Fleet 103.2 Private Fleet 3.1 Agriculture, Mining, Oil-field. Forestry 1.5 Agriculture, Mining, Oil-field. Forestry 1.5 Production and Distribution of Goods 268.7 Production and Distribution of Goods 5.3 Construction 6.0 Construction 2.5 Utility and All Other 54.0 Utility and All Other 2.0 All Fleet Types Combined 72.8 All Fleet Types Combined 17.2

Of those planning to acquire new trucks in the next 12 months, average number intending to purchase or lease.

Owner-Operators 10.0 For Hire/Common Carrier 44.8 Private Fleet 100.9 Agriculture, Mining, Oil-field. Forestry 1.0 Production and Distribution of Goods 269.3 Construction 12.5 Utility and All Other 36.5 All Fleet Types Combined 72.0 APPENDIX

DATA TABLES FROM 2008 HEAVY DUTY DISTRIBUTOR SURVEY

Distributor company provides remote jobsite Proportion of customers that are fleets with ten deliveries or services. or more heavy duty vehicles.

Yes No None 4% 91% 9% Less than half 36% Half 15% More than half 34% Distributor company’s market area. All or almost all 11% Local 4% County or City wide 11% Statewide 23% Number of locations company operates. Multi-state 55% Single location 23% National 9% 2 to 5 locations 34% 6 to 10 locations 23% More than 10 locations 19% Vehicle and shop services offered at distributor location. None Property32% of Proportion of distributors with municipal Machine shop 34% fleet customers. Minor installations 13% Yes No Have service bay and perform most maintenance and repairs 49% 96% 4%

114 The 2009 Global CommerHDMAcial Vehicle Report Interest level for supplier provided assistance. Not 2 Would welcome 4 Need interested any help immediate help Help with Barcode and RFID 13% 17% 28% 30% 13% Supplier assistance with merchandising and floor space optimization 11% 19% 32% 36% 2% Help with inventory management 17% 19% 26% 30% 9% Logistics integration 11% 20% 35% 26% 9% Supplier help in finding new customers 6% 4% 21% 34% 34%

Distributor use of business intelligence or Distributor members of marketing/buying information mining software. groups. Yes No Yes No 28% 72% 69% 31%

Distributor members ofmarketing/buying groups by group. Distributors using vendor managed inventory Heavy Duty America 35% with one or more suppliers. Power Heavy Duty 6% Yes No Truck Pride 14% 38% 62% Vipar 41% Other, please specify 5%

Distributor view of the relationship with Distributors purchasing exclusively through suppliers. group. Partner 50% Yes No APPENDIX Adversary 2% 12% 88% Necessary evil 7% Supportive 21% Part of the problem 4% Distributors sourcing products directly from Collaborator 5% off-shore manufacturers or importers. No relationship 4% Yes No Helping 4% 35% 65% Part of the family 4%

Property of Property of

HDMA The 2009HDMA Global Commercial Vehicle Report 115 Distributors’ interest in educational topics. Not Interestedl Neutral A little Interested Very at all interested interested Credit reporting and financial rating services 26% 23% 30% 19% 2% Barcodes and RFID 17% 23% 15% 34% 11% Business liability exposure 17% 17% 36% 28% 2% Compliance with local, state and federal laws 13% 26% 40% 19% 2% Detecting and reporting counterfeit parts 13% 13% 34% 26% 15% Best business practices 6% 11% 19% 36% 28% Educational resources 4% 6% 28% 43% 19% Inside and outside sales training 2% 9% 11% 49% 30% Technical and product training 2% 0% 9% 57% 32% Electronic Data Interchange (EDI) 11% 13% 22% 35% 20%

Distributors’ ratings of the importance of selected issues and topics. Not Important Neutral Slightly Important Very at all important important Industry wide standards for e-commerce 0% 6% 38% 47% 9% Insurance, pension, worker’s comp and other benefit issues 6% 2% 32% 36% 23% Inventory management 2% 13% 26% 32% 28% Key employee succession planning 4% 6% 32% 36% 21%

APPENDIX Lean operations 7% 4% 26% 41% 22% Obtaining OE diagnostic information to service new vehicles 6% 11% 15% 19% 49% Promoting repair, safety, or decreased emissions 13% 13% 28% 30% 17% Recruitment and retention 4% 4% 13% 40% 38% Federal Motor Vehicle Safety Standards (FMVSS) 9% 9% 40% 30% 13% State safety and emissions inspection programs 9% 13% 37% 30% 11% Suppliers national warranties 4% 9% 37% 28% 22%

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116 The 2009 Global CommerHDMAcial Vehicle Report HDMA Roster

3M Automotive Carlisle Motion Control Industries www.mmm.com www.carlislemotion.com Accuride Corporation Central Screw Products www.accuridecorp.com www.centralscrewproducts.com Affinia Group - Under Vehicle Champion Laboratories, Inc., www.affiniagroup.com Division of United Components, Inc. Affinia Group Inc. www.champlabs.com www.affiniagroup.com Cole Hersee Company Aftermarket Technology Corp. www.colehersee.com www.goatc.com Commercial Vehicle Group, Inc. AIAG - Automotive Industry Action Group www.cvgrp.com www.aiag.org Commercial Vehicle Systems Alcoa www.cvgrp.com www.alcoa.com Compressor Works, Inc. Alcoa Electrical and Electrical Solutions www.compressorworks.com www.aflauto.com Consolidated Metal Products, Inc. American Forge & Foundry, Inc. www.cmpubolt.com www.affjaxx.com Consolidated Metco ANXeBusiness Corp. www.conmet.com www.anx.com Contech Marathon Automotive Group Company ArvinMeritor CVS www.contech-global.com www.arvinmeritor.com Continental ASC Industries, Inc. (A UCI Company) www.continental-corporation.com www.asc-ind.com Continental, ContiTech Power Transmission Group Automotive Research & Consulting Group www.contitech-usa.com hdma ros t er www.arcg.co.uk Conway MacKenzie & Dunleavy AxleTech International www.c-m-d.com www.axletech.com Custom Sensors and Technologies Baldwin Filters www.cstsensors.com www.baldwinfilter.com Cyclo Industries LLC / Pidilite Industries Bar’s Products www.cyclo.com www.barsproducts.com Dana Corporation/Heavy Vehicle & BBB Industries Technology Systems Service/Dana Corporation www.bbbind.com www.dana.com Behr America, Inc. Dana Holding Corporation www.behrgroup.com www.dana.com Belmor Products Division Lund International Dana Spicer Service Parts www.belmor.com www.dana.com Bendix Commercial Vehicle Systems, LLC Dayton Parts, LLC www.bendix.com www.daytonparts.com Bendix Spicer Foundation Brake, LLC Defiance Metal Products www.foundationbrakes.com www.defiancemetal.com Bergstrom, Inc. Delphi Corporation www.bergstrominc.com www.delphi.com Betts Spring Company DENSO Sales California Inc. www.bettspring.com www.densoaftermarket.com Bezares USA Donaldson Company, Inc. www.pto-usa.com www.donaldson.com BGP Marketing Solutions, Ltd. East Coast Brake Rebuilders www.bgpmarketing.com www.eastcoastbrake.com Blachford, Inc. Eaton Corporation www.blachford.com www.automotive.eaton.com Borg Warner Torque Transfer ECCO Group www.turbodriven.com www.eccogroup.com Breeze IndustrialProperty Products Corp. EnerSysof (Odyssey Batteries) www.breezeclamps.com www.odysseyfactory.com Buffers USA Espar Products Inc www.buffersusa.com www.espar.com CARDONE Industries, Inc. Evora Enterprises Dba: Tarps and Beyond www.cardone.com www.tarpsandbeyond.com

118 The 2009 Global CommerHDMAcial Vehicle Report Exide Technologies Interstate-McBee, LLC www.exide.com www.interstate-mcbee.com Fabory North America IPD, LLC www.fabory.com www.ipdparts.com Federal-Mogul Corporation Jacobs Vehicle Systems, Inc. www.federal-mogul.com www.jakebrake.com Firestone Industrial Products Bridgestone/Firestone Inc. Karmak, Inc. www.firestoneindustrial.com www.karmak.com Five Star Manufacturing Company Kit Masters, Inc. www.fivestarmfg.com www.kit-masters.com Fleet Locks International Div of Ra-Lock KPMG, LLP www.ralock.com www.kpmg.com Flex-a-lite Consolidated Leece-Neville Heavy Duty Systems Division, www.flex-a-lite.com Prestolite Electric Flexfab, Inc. www.prestolite.com www.flexfab.com Lincoln Industries Flight Systems Electronics Group www.lincolnplating.com www.dana.com Link Manufacturing, Ltd. FPPF Chemical Company, Inc. www.linkmfg.com www.fppf.com Lubrizol Corporation Fras-Le North America, Inc. www.lubrizol.com www.fras-le.com Lucas Oil Products, Inc Freudenberg-NOK www.lucasoil.com www.freudenberg-nok.com MacKay & Company Gates Corporation www.mackayco.com www.gates.com MacLean Vehicle Systems Gent-L-Kleen Products, Inc. www.maclean-fogg.com www.gentlkleen.com Mahle Inc. Globe Specialty Company www.mahle.com www.glo-brite.com MANN+HUMMEL USA, Inc. GM Service & Parts Operations - AC Delco www.mann-hummel.com www.gm.com Marathon Brake Systems Grote Industries, Inc. www.marathonbrake.com www.grote.com Mark IV Automotive, Guardian Automotive Dayco Products, LLC www.guardian.com www.markivauto.com Haldex Brake Products Corporation Meridian Automotive Systems, Inc. Commercial Vehicle Systems Division www.meridianautosystems.com www.haldex.com Meritor WABCO Vehicle Control Systems hdma ros t er Haldex Commercial Vehicle Systems www.meritorwabco.com North American Sales Division Metaldyne www.hbsna.com www.metaldyne.com Hayden Automotive Div. of Standard Motor Products National Rubber Technologies, Inc. www.haydenauto.com www.nrtna.com Heavy Duty Manufacturing, Inc. NEXIQ Technologies www.heavydutymfg.com www.nexiq.com Heavy Motions, Inc. Noregon Systems Inc. www.heavymotions.net www.noregon.com Hella Corporate Center USA, Inc. Norgren Global Vehicle Technologies www.hellausa.com www.norgren.com Hendrickson Parker Hannifin Corporation www.hendrickson-intl.com www.parker.com Henniges Automotive Permatex, Inc. www.hennigesautomotive.com www.permatex.com Honeywell Consumer Products Group Peterson Manufacturing Company www.honeywell.com www.pmlights.com Horton Holding, Inc. Phillips and Temro Industries, Inc. Property of www.hortonww.comProperty ofwww.phillipsandtemro.com Index Sensors & Controls Phillips Industries www.indexsensors.com www.phillipsind.com Indian Head Industries, Inc. Pressure Systems International www.indianheadindustries.com www.psi-atis.com

HDMA The 2009HDMA Global Commercial Vehicle Report 119 Prestolite Wire LLC Thermal Dynamics International (TDI) www.prestolitewire.com www.tdi-corp.com Progressive Insurance Timbren Industries Inc. www.progressive.com www.timbren.com Pulltarps Mfg. TMD Friction, Inc. www.pulltarps.com www.tmdfriction.com Purosil Mission Rubber-Aftermarket Transmission Technologies Corp. www.purosil.com www.ttcautomotive.com Quick Cable Corporation Triangle Suspension Systems www.quickcable.com www.trianglegroup.com R. L. Polk & Company Tridako Energy Systems, Inc. www.polk.com www.tridako.com Radiator Works Inc. TRISEAL Corporation www.radiatorworks.com www.triseal.com Remy International, Inc Truck Parts & Service www.remyinc.com www.truckpartsandservice.com Robert Bosch LLC Truck-Lite Company, Inc. www.bosch.us www.truck-lite.com Roll Rite, LLC TruckEx Fleet Exhaust www.rollrite.com www.goerlichs.com SAF Holland Inc. TRW Automotive www.safholland.com www.trwauto.com Schrader Bridgeport International, Inc TRW Commercial Steering Systems www.schrader-bridgeport.com www.trucksteering.com Seaway Bolt & Specials Corp. U.S. Manufacturing Corporation www.seawaybolt.thomasregister.com www.usmfg.com SKF United Components Inc. www.skfusa.com www.ucinc.com

hdma ros t er Sloan Transportation Products Uzel Automotive, LLC. www.sloantrans.com www.uzelautomotive.com Spray Control System -- The Minimizer Valeo Inc. www.minimizer.com www.valeo.com States Friction Group Vehicle Safety Manufacturing, Inc. www.statesfriction.com www.vehiclesafetymfg.com STEMCO, LP Webb Wheel Products, Inc. www.stemco.com www.webbwheel.com Stoneridge, Inc. Wescon Products www.stoneridge.com www.wesconproducts.com SuperFlow Technologies Group Weyforth-Haas Marketing www.superflow.com www.whmdelivers.com Tendeco Sales, Inc. / Litens Automotive Group Whitley Products www.tendeco.com www.whitleyproducts.com Tenneco, Inc. Williams Controls www.tenneco.com www.wmco.com The Timken Corporation ZF Group North American Operations www.timken.com www.zf.com

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120 The 2009 Global CommerHDMAcial Vehicle Report Property of

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HDMA The 2009 Global Commercial Vehicle Report 117