Chinese truckmaker launches new high-end conventional - US market next?

[kscarbel2]

Truck 360  /  March 14, 2016

With the overall legal length of conventional cab (bonneted) tractor-trailers in the world’s largest heavy truck market set to increase to 18.1 meters (59.4 feet), the viability of short-nosed conventional cab tractors is now at hand.

Changes to the country’s GB1589-2012 dimension and weight regulations will allow an additional one meter (39.4 inches) in tractor length.

Dongfeng Group’s Liuzhou truck division, unrelated to Volvo's joint venture with Dongfeng’s Shiyan truck division (Dongfeng Commercial Vehicle), is the first player to take the stage with a modern conventional cab design.

Dubbed the T7, it is powered by either the 13-liter Cummins ISZ rated from 450 to 550 horsepower, or other high power options from Chinese engine makers Weichai and Yuchai.

Manual and AMT transmission options include Eaton, ZF and Fast Gear.

.

 

[mrsmackpaul]

I hope Americans think about the real cost before signing up to one of these and Im not talking about the dollars and cents purchase price of the truck either think about people 

 

Paul

[Timmyb]

Is there pollution control on Chinese trucks?

Euro-4 standard (SCR) with Euro-5 (SCR) available. Euro-6 (SCR + DPF) available next year.

Suppliers are Bosch, Tenneco, BASF and Corning..........the same names involved with the global brands.

 

[41chevy]

Looks like a Navistar/ Cat unit. 

[Underdog]

Looks like a Navistar/ Cat unit. 

I thought same as a freightliner cascadia. Only with Cummins engine.

[41chevy]

2 minutes ago, Underdog said:

I thought same as a freightliner cascadia. Only with Cummins engine.

Yep  Your right too. so it's a Dongnavicatlinerfong.

[Underdog]

Yep  Your right too. so it's a Dongnavicatlinerfong.

Not much different than our current domestic offerings.

[41chevy]

With China's currency manipulation they will be an inexpensive alternative to the other units. We'll probably see a ton of them on the roads when the fleets  see the savings.

[kscarbel2]

16 minutes ago, 41chevy said:

With China's currency manipulation they will be an inexpensive alternative to the other units. We'll probably see a ton of them on the roads when the fleets  see the savings.

Many argue that China is no longer a currency manipulator. I agree. These trucks, sold in the US, will be attractively priced, but not cheap, as the cost of labor in a matured China is no longer low.

------------------------------------------------------------------------------------------------------------------------

The Myths of China’s Currency ‘Manipulation’

The Wall Street Journal  /  January 8, 2016

Movements in the yuan’s nominal exchange rate do not affect long-term trade flows or jobs in the U.S.

Global equity markets have experienced steep declines since the new year, and many assert the devaluation of the yuan by the People’s Bank of China is a major cause of this week’s turmoil.

These devaluations have fueled long-standing outcries that China is playing dirty. Presidential hopeful Donald Trump, for example, recently claimed on these pages that “the wanton manipulation of China’s currency” is “robbing Americans of billions of dollars of capital and millions of jobs.”

To cut through all the hyperbole, the mechanics and consequences of China’s exchange-rate regime need to be understood—not only for this week but also for the coming year, when the yuan will be debated in the context of other issues such as the Trans-Pacific Partnership. Here are three essential points.

First: The legal monopoly power to create money that each central bank enjoys allows it to fix one nominal price—which can legitimately be an exchange rate—to achieve policy goals such as price stability or full employment.

Today many central banks choose to fix a nominal interest rate. The U.S. Federal Reserve targets the federal-funds rate, the interest banks charge each other for overnight loans. The European Central Bank targets the rate on the “marginal lending facility,” its version of that overnight market. Other central banks fix a nominal exchange rate; China’s central bank, for example, for years fixed the yuan-U.S. dollar rate and since last month fixes the yuan price of a basket of 13 currencies (in which the dollar still figures prominently).

Currency devaluation or revaluation is a common exercise of sovereign monetary policy. During the post-World War II Bretton Woods regime, dozens of countries pegged their currencies to the dollar while, in turn, the Fed pegged $35 to an ounce of gold.

Reasonable people can and do disagree about how countries conduct their monetary policies: what price should the central bank fix, or at what pace should that fix evolve. But to label as manipulation the conduct of monetary policy itself betrays a fundamental confusion about the operation and goals of central banks. If Zhou Xiaochuan, governor of the People’s Bank of China, is a currency manipulator, then Janet Yellen is an interest-rate manipulator.

Second: Movements in the nominal yuan exchange rate have almost no long-term impact on global flows of exports and imports or on broader considerations such as average wages. The exchange rate that matters for trade flows is the real exchange rate, i.e., the nominal exchange rate adjusted for local-currency prices in both countries.

The real exchange rate, in turn, reflects the deep forces of comparative advantage such as technology and endowments of labor and capital. These forces drive trade regardless of monetary policy.

Think about the companies involved in trade. Yuan depreciation tends to be partly offset by Chinese companies raising their yuan prices. A large academic literature has repeatedly found that profit competition among a country’s exporting companies typically undoes about half of that country’s nominal exchange-rate swings. Today more companies operate in global supply networks—in which trade and investment link different stages of production across different countries. Because these networked companies incur both revenues and costs in many currencies, their trade competitiveness tends to vary little with the movement of any one currency.

Long-term movements in nominal exchange rates often have nothing to do with the evolution of global trade flows. In the generation after the Bretton Woods system dissolved, the dollar steadily depreciated against the Japanese yen, from its fix of 360 yen per dollar to an average of just 94 in 1995. Over that time did the U.S. swing into a massive trade surplus with Japan? No.

From $1.2 billion in 1970 the U.S. trade deficit with Japan rose by a factor of 50, to $59.1 billion in 1995. From 2004 to 2014 the dollar similarly depreciated—note, not appreciated—against the yuan by about 25%. Over that decade the U.S. trade deficit with China soared—not fell—from $161.9 billion to $342.6 billion.

Third: As China relaxes its many capital controls—per the entreaties of America and many others—strong forces will be pushing down the value of the yuan. The main such force will be the pent-up demand of Chinese households and companies to diversify their wealth into non-Chinese assets.

The surging incomes and wealth in China over the past 35 years have had very little access to global assets, a restriction that has contributed to surging Chinese real-estate prices and to high saving rates of Chinese households. Relaxing controls on outward capital flows will expand Chinese demand for non-Chinese assets—and thus will expand demand for non-Chinese currencies.

The world has legitimate concerns about several Chinese economic policies. China has too many barriers to trade and investment, too much favor for local companies, too weak protection of intellectual property. But the more leaders in America and elsewhere hector China over the yuan, the less ability these leaders have to encourage China to overcome its policy shortfalls that truly do cost America good jobs at good wages.

 

 

[kscarbel2]

The research firms are always somewhat off, their people never having worked in the business and known its "heart beat". But this info is in the ball park of what's to come.

--------------------------------------------------------------------------------------------------------------

Truck OEMs Aim for New Breed of ‘Low-Cost’ Models

Trailer/Body Builders  /  January 18, 2011

Research firm Frost & Sullivan has unveiled a detailed analysis of what it calls the “low cost truck” movement, a strategic initiative by truck manufacturers either individually or through joint ventures that will completely reshape the types of commercial vehicles used around the world.

“What we’re seeing is a determined effort to build trucks that cost 20% to 25% less in any given global market – from North America to Brazil, Russia, and Europe,” Sandeep Kar, global program manager--commercial vehicle research for Frost & Sullivan, told Fleet Owner. “And this effort will cover the entire commercial vehicle spectrum, from light- to medium- and heavy-duty models.”

For the study –  titled Strategic Analysis of the Global Low Cost Truck Market – Frost & Sullivan interviewed OEMs and suppliers from around the world, conducted its own research, and then made near-term projections for the low-cost strategy spanning 2010 to 2016.

Kar said the firm’s research indicates new low-cost price ranges will develop as follows: $4,000 to $20,000 for a light commercial vehicle (LCV); $15,000 to $40,000 for a medium commercial vehicle (MCV); and $30,000 to $70,000 for a heavy commercial vehicle (HCV).

According to Kar, the impetus for this strategy on the part of truck builders is that commercial fleets are simply under far too much bottom-line pressure today – paying for higher fuel prices, the cost of regulatory compliance, higher pay to compete for workers – to afford ever-higher sticker prices on new equipment.

Dahlman Rose transportation economist Jason Siedl  noted at FTR Associates’ annual freight outlook conference last September that the average cost for a new Class 8 tractor is up to $120,000 in the U.S. One fleet at that meeting said that its Class 8 tractor costs increased $25,000 per unit from 2002 to 2010.

It’s the financial pressure those high prices put on U.S. fleet owners that in turn is driving the effort to create low cost trucks, said Frost & Sullivan’s Kar.

“We expect to see phenomenal growth in the North American market for low cost trucks,” Kar pointed out. “Our research indicates the average base price point for a heavy-duty truck in North America is about $104,000. Now say some $10,000 to $15,000 worth of emission control and safety systems need to be added to the low-cost truck platform to bring it into regulatory compliance. You’d still be looking at a truck that is $80,000 to $95,000-- still cheaper than current prices today.”

Of course, such low- cost trucks would not contain the same amenities found on many of today’s commercial vehicles – especially in terms of driver-comfort specs. For that reason, Frost & Sullivan contends the North American truck market will become two-tiered, having  a low-cost  and a premium segment, with mid-priced models disappearing.

We would also not see the low-cost model challenge the long-haul Class 8 sleeper segment,” he noted. “Rather, we’d see the low-cost Class 8 model dominate the short-haul daycab segment.”

The key to making these low-cost trucks a reality, however, will rest on creating a far larger global manufacturing scale than exists now-- along with a global supplier network. “Making a low-cost truck means cutting costs throughout the vehicle,” Kar observed.

Per Frost & Sullivan, areas where costs will be cut include:

5% to 8% from powertrains

3% to 4% from chassis

3% to 4% from driver comfort and amenities

3% to 4% from engines

1% to 2% from marketing efforts

Overall, total production costs for a low- cost truck platform should fall anywhere from 19% to 29%, Kar said.

Yet can the low-cost trucks find willing fleet buyers in the U.S.? Kar definitely thinks so. “Total cost of ownership or ‘TCO’ is now the most critical metric within most fleets,” he explained.

“Access to financing is still limited and after the recent economic downturn, fleets still have little cash to spend,” Kar added. “In a way, fleets will almost be forced to look at low-cost truck models due to the operating conditions they will continue to face.”

[41chevy]

That's why I said inexpensive as opposed to cheap. Even a savings of a few percent over a so called main stream unit is a plus for most companies. Paul

[TeamsterGrrrl]

But will it really save any money? The average new class 8 truck today will cost over a million dollars to fuel, repair, insure, and pay a driver for over it's lifetime. Saving $20k to 40k on the price of a new $120k premium truck isn't worth it if the "bargain" truck lasts only half as long as the premium truck, costs more to keep running, and wastes it's driver's time while crawling over hills if dead in the shop.

[Svin]

This is the Chenglong T7 450 6x4. The cab is based on the Renault Premium there are coe also.

[41chevy]

1 hour ago, TeamsterGrrrl said:

But will it really save any money? The average new class 8 truck today will cost over a million dollars to fuel, repair, insure, and pay a driver for over it's lifetime. Saving $20k to 40k on the price of a new $120k premium truck isn't worth it if the "bargain" truck lasts only half as long as the premium truck, costs more to keep running, and wastes it's driver's time while crawling over hills if dead in the shop.

Many or hopefully most will companies will see it that way, but I would bet quite a few will only look at the initial outlay.

Now, what  I've read on them they have drive train wise, mostly the same as the premium unit, the savings seems to be on the labor costs and how they enter the country, fully assembled or a partial knock down. 

Inexpensive unit + inexperienced "driver" working for low salary = initial increase in profits. Since most times today it seems profit rules over ultimate costs.

 Paul

[mrsmackpaul]

2 hours ago, TeamsterGrrrl said:

But will it really save any money? The average new class 8 truck today will cost over a million dollars to fuel, repair, insure, and pay a driver for over it's lifetime. Saving $20k to 40k on the price of a new $120k premium truck isn't worth it if the "bargain" truck lasts only half as long as the premium truck, costs more to keep running, and wastes it's driver's time while crawling over hills if dead in the shop.

even if they last just as well but will they be worth any thing come trade in time I know out here cheap Korean cars and stuff from that part of the world no one wants it so you just about have them for life or give them away to the dealer after a couple of years 

 

[kscarbel2]

5 hours ago, mrsmackpaul said:

even if they last just as well but will they be worth any thing come trade in time I know out here cheap Korean cars and stuff from that part of the world no one wants it so you just about have them for life or give them away to the dealer after a couple of years 

 

Hyundai Group's Hyundai and Kia brands have come a long way in record time. From 2005, they hired a number of global designers* including the fellow who did the original Audi TT. Today, the latest models are on par with Japan in all aspects, having overcome their last shortcoming.....handling. Thus, the resale value of the latest model Hyundai Group products is holding up in the US market.

* including: VW Group's Peter Schreyer, BMW's Chris Chapman and Thomas Burkle, and Bentley's Luc Donckerwolke.

[kscarbel2]

7 hours ago, Svin said:

This is the Chenglong T7 450 6x4. The cab is based on the Renault Premium there are coe also.

Via Renault Trucks Components Partnerships, it all started with them importing Kerax vocational in CKD form. But that means being too expensive and impractical, and with attention shifted more to on-highway tractor (prime movers), it evolved into a Premium hybrid with local production. Today's truck is far from a Premium, essentially a self-design.

[mrsmackpaul]

1 hour ago, kscarbel2 said:

Hyundai Group's Hyundai and Kia brands have come a long way in record time. From 2005, they hired a number of German designers, including the fellow who did the original Audi TT. Today, the latest models are on par with Japan in all aspects, having overcome their last shortcoming.....handling. Thus, the resale value of the latest model Hyundai Group products is holding up in the US market.

I would like the to say it was the same out here but you cant give them away Kia Proton Daewoo no body wants them second hand yeah they are cheap to buy but you have them for life so to speak a bit like Russian Lada Niva's a cheap little 4x4 but no wants them 

 

Paul 

[kscarbel2]

On 4/16/2016 at 10:50 AM, mrsmackpaul said:

I would like the to say it was the same out here but you cant give them away Kia Proton Daewoo no body wants them second hand yeah they are cheap to buy but you have them for life so to speak a bit like Russian Lada Niva's a cheap little 4x4 but no wants them 

 

Paul 

Paul, Malaysian automaker Proton has become much better, but the Japanese brands still outsell them there for a reason.

GM bought Daewoo in 2001, but used the name until 2011. The GM global designed products coming out of the former Daewoo today, like the Chevy Captiva, Cruze, Spark and Buick Encore, are all of good quality.

You speak of the Kia from a decade ago (they've come so far so quickly!). This review reflects the Kia of today (http://www.caranddriver.com/reviews/2016-kia-sorento-long-term-test-review).

The Japanese brands are truly fearing Hyundai and KIa now.......and they should.

 

[mrsmackpaul]

I hear what you are saying and agree but its the age old problem takes 5 seconds to get a bad name and years to get a good name and yes they have made quantum leaps in relative short period time

and yes we have the Holden Captiva and Holden Cruze  and maybe even the Holden spark I believe I saw it on the telly a few weeks ago 

 

looking like we have the same cars as the US now only steering wheel is on the correct side out here LOL I guess thats the global world we live in now

 

Paul

  

[Timmyb]

Now we have grand tiger, Great Wall and cherry cars being sold in Aus. 

For a population of just 24 mil we have over 60 different manufacturers selling here. 

[kscarbel2]

20 hours ago, Timmyb said:

Now we have grand tiger, Great Wall and cherry cars being sold in Aus. 

For a population of just 24 mil we have over 60 different manufacturers selling here. 

You're right Tim. And think of New Zealand, heavy trucks for instance...........every global truck brand is represented there.

Those Great Wall V-Series pickups and X-Series SUVs are actually quite good now.

Do you remember the Isuzu Axiom that followed the Trooper but didn't sell. The always financially-troubled Isuzu sold GW the design, and they made it good looking. Their 2.5L diesel is based in the Isuzu 2.8L, and their 2.0L......they bought from Hyundai Group. They buy their automatic trannies from Hyundai as well.

The V-series pickups (aka. ute, bakkie) are solid trucks too. I'd buy the diesel Ford Ranger, but it depends on how much you want to spend.

http://greatwallmotors.com.au/showroom/x-series

http://www.greatwallmotors.com.au/showroom/v-series-dualcab

My gripe in the states is that Toyota won't import the 70 series Land Cruiser. The FJ40 and FJ55 established the brand in America. They were affordable trucks, a CJ-5/CJ-7 alternative. But the states today only gets the ridiculously overpriced Land Cruiser 200 series with all the options, and the Lexus equivalent. There's no Land Cruiser for the mainstream market. The 70 Series is the direct descendant of the FJ40.

http://www.toyota.com.au/landcruiser-70-series

E-Brochure - http://www.toyota.com.au/static/vehicles/landcruiser-70-series/content/pdf/landcruiser70_ebrochure.pdf

South Africa:

http://www.toyota.co.za/ranges/land-cruiser-76

http://www.toyota.co.za/ranges/land-cruiser-79

Gibraltar:

https://www.youtube.com/watch?v=ltWdbnRhoNI

https://www.youtube.com/watch?v=mzgoiQd-mcI

Another oddity is the states gets the Lexus GX, but not the much more affordable Toyota version that started it all.....the Land Cruiser Prado.

http://www3.toyota.com.au/prado?WT.ac=Toyota_ShowroomPage_Suvs_Prado_Visit

http://www.toyota.co.za/ranges/land-cruiser-prado

[mrsmackpaul]

there has been talk for some time about no longer importing the 70 series here giving us the 200 serie and the Tundra ????? ( dunno what that is ) and the PUSSLUX as I call it 

 

Dunno I think it would be a big mistake for Toyota to do that 

[kscarbel2]

The Liuzhou division of Dongfeng (completely separate from Dongfeng Commercial Vehicles with which Volvo has a joint venture) officially launched its all-new North American style short-nosed conventional tractor at the Beijing auto show on Monday.

The truck is refined and impressive throughout......a job well done. If one swapped out the China market Euro-4 Cummins 13-liter ISZ, and replaced it with that engine's predecessor, the US market EPA2010 11.9-liter ISX12 (or larger), and added a DPF, you'd be ready to go.

.

[Vladislav]

Looks well-built on the pictures.

The most interesting question is how long it would last.

I used to hear that Chinese producents increaset quality of their vehicles to a good level during the decade although together with noticable increase of costs.

Last years we have planty of big dump trucks on the roads and I noted some tractor units recently also. Suppose they're about twice cheaper than Scania's.

 

Paul,

Holden Cruse and Holden Spark... I wouldn't thought I ever hear anything like that. Just makes shivers up and down my spine.