The Traton Group is looking to its acquisition last year of Navistar, and to the Chinese market, to help it meet what it called “an ambitious margin target for 2024.” Key in its plans for the next few years are development of a modular truck platform and increasing focus on sustainability.
During its May 18 Capital Markets Day in Södertälje, Sweden, where Traton brand Scania is headquartered, company officials said sales are expected to grow in the medium term, primarily driven by a highly competitive product and service offering, the company’s recent entry into the North American market with Navistar, and the establishment of production in China.
As a key part of its strategy, Traton announced it is gradually introducing a common modular system for trucks and buses for all its brands. In the coming years, vehicles from Scania, MAN, Volkswagen Caminhões e Ônibus (which will be renamed Volkswagen Truck & Bus), and Navistar will increasingly be based on the Traton Modular System.
Going beyond the development of common engine platforms we’ve seen global companies introduce to the trucking industry in the past decade, the aim is for all Traton brands to use more common components and parts, mainly within the powertrain, cab, software platforms, and chassis. For Navistar, part of that is an ambition to increase the number of 13L engines compared to 15L engines in its Class 8 trucks.
At the same time, Traton said, each brand will maintain and strengthen its identity and individual offering for its respective customer base.
This modular approach will be more efficient for the company and also cushion the investments needed and higher costs of future technologies such as electric drivetrains and autonomous driving, said Christian Levin, Traton CEO. “Standardized interfaces throughout the group will enable a much faster exchange of technology. We will be able to use identical solutions for the same needs, and thus achieve maximum customer focus and maximum price points.”
Traton also will develop a group-wide ACE platform for autonomous, connected, and electrified vehicles.
In addition, the Traton Group said, it intends to become even more responsible as a company, including decarbonization.
Traton said it wants to play an active role in shaping the transportation and logistics ecosystem of the future. To do so, the company intends to create new business models and partnerships that “add value in a world marked by electrification, autonomous driving, and connectivity.”
The company said it is fully committed to the Paris Agreement on climate change. All its brands have validated science-based targets or are in the process of obtaining them. Navistar’s goal is a 20% energy intensity improvement by 2030 compared to 2018, and a 24-25% reduction in “tank-to-wheel” carbon emissions per ton-mile by 2027, compared to 2017.
As company officials have said before, Traton Group believes that battery-electric trucks and buses are the future. During the Market Day presentation, the company projected that by 2040, BEVs would become the majority technology.
More than two-thirds of Traton’s total development budget is allocated to new technologies and growth. The company said its successful 13L common base engine, the CBE, will be the group’s last internal-combustion engine.
ACE and Services
Autonomous, connected, and electrified vehicles also mean opportunities for truck makers to offer customers more services.
For instance, Traton Financial Services can help customers on their journey towards sustainable transport. Traton’s Vehicle Services business can provide complex repair and maintenance work for these new high-tech vehicles, including components such as battery systems.
In addition, the service portfolio can be expanded, for example to include charging services, battery recycling, or service offerings based on vehicle networking.
Traton Profitability Goals
Traton Group is targeting a 9% return on sales overall for 2024. Scania is aiming for a strategic return on sales of 12%, MAN Truck & Bus 8%, and Volkswagen Caminhões e Ônibus 8%.
Navistar is targeting a strategic return on sales of 9%, “particularly with the positive effects from the utilization of the Traton Modular System and improved dealer network performance, as well as expanded vehicle services business and financial services,” the company said in a news release. “The brand has the ambition to further increase profitability in the long term.”