Cummins Keeps Top Market Share; In-House Engines Rise, Ward’s Says
This story appears in the Feb. 17 print edition of Transport Topics.
Engine maker Cummins Inc. maintained its leading 40.4% North American market share during 2013, even though most proprietary engines claimed a bigger share, WardsAuto.com reported.
Daimler AG, Volvo Group and Paccar Inc.’s gains in the engine market did not erode Cummins’ overall share because the Columbus, Ind.-based manufacturer sold more engines to Navistar Inc.
Daimler Trucks boosted its engine market share to 25.9% in 2013 from 24.2% the year before, Ward’s said. Volvo units Volvo Trucks and Mack Trucks increased their combined market share to 17.5%, up from 16.5%, and Paccar’s market share climbed to 7.9% from 5.2%.
Though Cummins’ market share remained above 40%, its sales volume fell 10.9% to 98,256 in 2013 — closely mirroring an 11% decline in industrywide shipments, to 243,003.
Jefferies & Co. analyst Stephen Volkmann said he expects that trend to continue and that Cummins probably will offset losses by growing its business with Navistar.
“To the extent [Cummins] loses a little share at Paccar or Freightliner or Volvo, they probably gain that back at Navistar,” he said.
Cummins is the industry’s only major independent engine maker and supplies engines to all truck makers.
“We think Cummins’ market share will be relatively resilient in the next couple years,” said William Blair & Co. analyst Lawrence De Maria, who added that Cummins could receive a boost if Navistar successfully rebuilds market share for its International trucks.
Last year, Cummins introduced an integrated powertrain package combining its ISX15 engine with an Eaton transmission, which Volkmann said was “obviously an answer” to OEM arguments about vertical integration.
OEMs generally attributed their 2013 gains in engine share to fuel economy improvements and automated manual transmissions available with their proprietary engines.
At Daimler Trucks North America, for example, Brad Williamson, manager of engine and component marketing, said Detroit’s engine sales were paced by the company’s redesigned DD15 power plant and customer acceptance of Detroit’s DT12 automated manual transmission.
Engines from Daimler’s Detroit subsidiary went into 57,295 Freightliner and Western Star trucks built in 2013, down 4.6% from 2012. Shipments of Daimler’s Mercedes-Benz truck engines slipped 3.4% to 5,685.
Ward’s figures include engines installed in trucks built in North America for export.
Paccar put 19,079 of its engines in its trucks, a 34.3% jump from 2012.
Paccar Treasurer Robin Easton said the company’s market share gain reflects an increase in adoption of the Paccar MX-13. In the fourth quarter, Paccar installed that engine in 37% of the company’s Kenworth and Peterbilt heavy-duty trucks, he said.
“Paccar has a goal of 50% penetration of the MX-13 for Kenworth and Peterbilt,” Easton said.
Nevertheless, Paccar remained Cummins’ top customer in the North American market. Ward’s said 52.7% of the engines Cummins sold in 2013 went into Paccar trucks, down from 60% in 2012.
Market share for Navistar’s Maxx-Force engines dropped to 8.3% in 2013 after the company captured 13.7% of the market in the previous year. The company shipped 20,221 engines, down from 37,355 in 2012.
Navistar’s drop in engine share reflects its aftertreatment technology changeover and the reintroduction of Cummins engines to its heavy-duty truck lineup.
The number of engines Cummins sold to Navistar jumped to 16,861 in 2013, up from 9,932 a year earlier.
Most of the trucks shipped with Cummins engines in 2012 were for export.
The truck maker began offering Cummins engines in its International trucks in North America at the tail end of 2012 as part of its transition to selective catalytic reduction aftertreatment.
In April, Navistar also began offering its own MaxxForce 13 engine with SCR technology.
“With a full lineup of products — powered by the Cummins ISX15 and the MaxxForce 13 — we’re well positioned to regain share,” Navistar spokesman Steve Schrier said.
The availability of Cummins engines in International trucks “has been welcomed by a variety of customers that prefer to spec a fuel-efficient 15-liter engine,” Cummins spokeswoman Christy Nycz House said.
Volvo Trucks’ engine shipments rose 11.6% to 22,524 units last year. At the same time, the number of Cummins engines installed in Volvo trucks dropped to 3,544, compared with 6,009 in 2012.
“Demand for Volvo engines continues to grow as motor carriers seek the fuel efficiency and performance of integrated powertrains,” said Göran Nyberg, president of North American sales and marketing.
Mack engine shipments fell 20.2% to 19,937 in 2013. The vast majority of Mack trucks sold in North America feature Mack’s MP engines.
“We believe the industry will continue to move toward vertically integrated engines and powertrain solutions,” said John Walsh, Mack’s vice president of marketing.
