New trucks: Thriftier and net-connected

At first glance, all is well at IAA 2014. There are more exhibitors from more countries than ever before, more world premieres, and displays of technical wizardry, as when a humungous truck, steered by a tablet computer, parks itself in a tight space.

But problems lurk just behind the confident facade presented by chic trade fair booths.

Regulatory constraints such as tighter emissions standards present truck makers with challenges, but they're manageable by means of technical improvements. The greater concern is the demand-dampening effect of the many political and economic crises in progress around the world.

The economic sanctions associated with the conflict between Russia and Ukraine, in particular, are weighing on business.

Truck makers are feeling the effect of sanctions

Matthias Wissmann, president of the German automobile industry association VDA, points to the fact that even before the crisis over Ukraine broke out, the Russian economy was weakening. Now sanctions are adding to the slowdown.

"Yes, we're feeling it. Thank goodness we're not dependent on the Russian market alone. If similar crises were to break out in other regions of the world, it would hit us harder. But even as it is, we're worried," he said.

Global political crises always have an effect on truck markets, Wissman said, and "in the Russia-Ukraine case, that's definitely the case."

But it isn't only east of Germany that there are problems. Elsewhere, too, the market for heavy trucks as well as smaller delivery vans isn't very lively at the moment. Truck-maker MAN has already given notice to its employees that it wants to short-staff two factories.

Daimler, the global market leader in heavy trucks, is nowhere near the point of having to short-staff; sales remain robust. But Wolfgang Bernhard, CEO of Daimler's trucks and buses division, says there are many regional worries: In Brazil, sales are slow at the moment, and in Argentina sales have fallen off a cliff. Even in Daimler's home market, Germany, buyers are showing restraint.

Preparing for tougher times

Bernhard says it isn't yet clear what the reason is for German buyers' restraint, but the important thing is "not to drive full-speed into a crisis when one arrives". By that, he means production rates have to be slowed down somewhat on a timely basis, so that huge inventories of unsold trucks don't build up.

"We hope that there will be more life in the markets by the end of the year, and that the IAA trade fair will help add some energy too," Bernhard said. That would leave Daimler's trucks and buses division with only a mildly smaller revenue total than the year before. "We hope things will pick up again in 2015," he added.

Eckhard Scholz, head of Volkswagen's utility vehicles division, is more optimistic. His division includes lighter trucks like cargo vans and transporters; heavier trucks are produced by the new MAN-Scania division.

"We're actually doing extremely well this year. And we're seeing that the current wave of sales is going to carry on into the new year," he told DW.

But VW is watching the market closely, he added, in order to be able to react in time should signs emerge that demand will slacken. That's already the case in Brazil, where the VW Amarok pickup truck is selling poorly at the moment. VW has cut back production to reflect sales.

The truck of the future

If technology, rather than current market conditions, is taken as the criterion for whether or not to feel optimistic about the trucking sector, IAA has a lot of nifty reasons for optimism on display.

There's an electric-powered city utility vehicle in VW's line-up, intended to appeal to companies that make a lot of deliveries on short trips in big cities, like pizzerias and courier services.

There's Daimler's "Future Truck", which takes the chore of driving off the driver's hands - but that's still in the future, as the name implies.

There's the ZF Innovation Truck, a giant truck that backs itself into a parking-space using an electric motor as the driver stands next to it, steering by remote, with a tablet computer. The tablet-steering system was developed by engineers at ZF Friedrichshafen, one of the trucking sector's biggest components suppliers.

The company was in the news last week after it completed a $13.5 billion (10 billion euro) takeover of TRW Automotive, a US-based maker of automotive safety products like brakes and air-bags.

ZF's CEO Stefan Sommer said the development of the ZF Innovation Truck was necessary in order to stay ahead of the competition.

"We want to remain the leading supplier, we want to be able to offer system solutions. And so we have to be able to cover the spectrum of megatrends like autonomous vehicles or computer-assisted driving," Sommer said.

In reference to ZF's takeover of TRW, Sommer added that ZF wants to be able to offer its new technologies in every global region at the same time.

"That's only possible with size and strength, and with a great many competent employees around the world," he said.

ZF's example indicates where the industry is heading. Until now, ZF, founded in 1915 to build transmissions for airships and motor vehicles, has focused mainly on transmissions and steering systems. Now the company wants to get positioned to participate in emerging megatrends.

For the trucking sector, that means greater fuel efficiency as well as improved safety through computer-assisted driving - and eventually, autopilots connected to online real-time traffic monitoring networks.

Clean, efficient, quiet, safe trucks: What's on display during the coming week at IAA in Hannover, from 25 September to 2 October, suggests the truck-making industry is intent on making loud, filth-spewing, traffic-blocking, roaring monsters of the road things of an unlamented past.