A full 20% of Chinese carriers plan to upgrade their trucks and purchase a European-built model with their next vehicle purchase. That’s good news for European truck OEMs, which have spent the better part of the past two decades slowly building their reputations and customer base in the world’s most populous nation.
According to a report compiled by Bain Insights and published on the Forbes website last month, most Chinese carriers still intend to purchase domestic- or European-Chinese-joint venture trucks the next time they upgrade their fleets. But this does little to dampen the good news for European OEMs, which the study found enjoy significantly higher customer loyalty rankings than Chinese and joint venture (JV) trucks.
Moreover, the findings indicate a substantial number of Chinese fleets are prosperous enough now to pay more for better quality trucks, stay with those brands longer, and generate positive word of mouth about the vehicles. Even better: The majority of respondents who indicated a preference for European-built trucks also indicated they plan to purchase new vehicles in the next three years.
According to the Bain analysts, the study also points to a Chinese trucking industry that is maturing rapidly, as more truck buyers there are increasingly focused on total cost of vehicle ownership, including fuel economy. This dovetails with additional shifts in the Chinese trucking industry identified in the report, which notes that early Chinese fleet operations were focused in construction applications as the country launched a massive infrastructure modernization program. But now they appear to be moving toward more logistics-style long- and short-haul applications.
European OEMs still have work to do, the Bain report noted, including localizing production to further reduce acquisition costs and develop deeper sales and service networks.