Regulations threaten manufacturers, but fuel-efficient technology will strengthen demand.
Los Angeles, CA (PRWEB) November 05, 2013
The Truck and Bus Manufacturing industry faced volatile swings over the past five years; however, recent activity in key downstream markets has the industry rolling along smoothly. “After suffering through the downturn, truck and bus manufacturers have enjoyed heightened demand for their products as the economy has since rebounded, resulting in higher trade and freight volumes,” according to IBISWorld Industry Analyst Brandon Ruiz. Additionally, the Environmental Protection Agency (EPA) enacted a final phase of emissions standards in 2010. As a result, truck manufacturers, were able to cope with the rising demand for vehicles that are compliant with these standards. In turn, production capacity used to meet this demand is becoming more active, while freight companies are also ramping up output. As trucking activity continues to recover, revenue is expected to climb 2.4% in 2013. Moreover, IBISWorld expects revenue to grow at an annualized rate of 1.4% to total $20.4 billion over the five years to 2013.
The Truck and Bus Manufacturing industry is highly globalized and concentrated. Over the past five years, a slump in domestic activity enticed major players to expand internationally, with a particular focus on Asian and South American markets. The relative decline of manufacturing and export-focused industries in the United States limited growth prospects for truck manufacturers; as a result, manufacturers moved operations to emerging economies where production costs are lower. In light of these trends, the number of industry operators is expected to decrease at an average annual rate of 1.0% to total 78 over the five years to 2013.
The next five years are expected to be brighter for the industry. “Strengthening global growth will likely lead to higher trade and freight volumes and, in turn, increased demand for trucks to carry goods, creating greater demand for new truck purchases,” says Ruiz. Furthermore, as a result of previous EPA regulations, truck and bus manufacturers have heavily invested in new technologies since 2007. Trucks that make use of fuel-efficient technologies and alternative fuels will be appealing as diesel fuel prices rise over the next five years. These trucks will also fetch higher prices as demand for trucks grows while the US economy continues to recover, enhancing the profitability of the industry in the process.
For more information, visit IBISWorld’s Truck and Bus Manufacturing in the US industry report page.
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IBISWorld industry Report Key Topics
Companies in the Truck and Bus Manufacturing industry manufacture truck and bus chassis and assemble trucks, buses and other specialty heavy-duty vehicles, including ambulances and firefighting trucks. This industry includes heavy trucks used by freight companies but excludes passenger vehicles.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.