Four businesses stand to gain as the demand for semitrucks increases

There is a surge in demand for semi-trucks, and four businesses stand to gain.

Due to the recent record-high demand for trucks, semi-truck manufacturers have transitioned from managing extremely tight supply constraints to fulfilling orders now that parts are starting to flow more freely.

“Demand for trucks is, I would say, unprecedented,” said David Carson, SVP of sales and marketing for Daimler Trucks North America. “We’ve seen an incredible demand going through Covid and continuing well into [this year]. That demand exceeds our capacity and it exceeds the capacity of the entire industry.”

Somewhere between 95,000 and 284,000 new semi-trucks are sold in America each year, and as of late 2022 sales were on track to be on the high end of that, said J.D. Power analyst Chris Visser. On average, a semi with a sleeper cabin will cost about $150,000. A fully loaded one can run above $200,000.

Four companies dominate U.S. truck manufacturing: Daimler Trucks, Paccar, Volvo, and Traton. Daimler is the biggest: It has about 40% market share, mostly through its Freightliner brand.

The business is going through a period of tremendous change. Truck makers are spending billions to replace fuel-burning diesel engines with battery- and hydrogen-powered electric systems. There is also a race to build trucks that can remove the driver entirely, which could drive down costs and allow companies to run trucks without breaks.

A lot of this change is being forced from outside the ranks of the companies that have served this market for decades.

“You can credit [Tesla CEO] Elon Musk with making trucking cool, as polarizing as he can be,” said Craig Fuller, founder, and CEO of Freightwaves, which provides data and news about the trucking industry.

Legacy truck makers such as Daimler have had to invest in electric semi-truck technology, partly to satisfy increasingly stringent regulations and partly to compete with attention-grabbing outsiders such as Musk.

But it is unclear if there is a solid business case for some of these innovations.

Recently, the industry has also been afflicted by foul play. The CEO of the well-known self-driving truck startup TuSimple was fired for unlawful business connections with a Chinese company, while the creator of the once-heralded hydrogen fuel vehicle manufacturer Nikola Motors was found guilty of fraud.

Established truck manufacturers, like the more than 100-year-old Daimler, balance keeping their specific and frequently extremely cost-sensitive customers satisfied in the present with investing for an unknowable future.