No ‘cliff event’ with ’07 engines, Volvo says

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“We are very much sold out for the year,” Peter Karlsten, president and CEO of Volvo Trucks North America, told CCJ editors during a meeting at the American Trucking Associations convention in Boston this week.

Volvo will sell between 31,000 and 32,000 trucks to the North American market in 2005, he said, most for replacement. “We don’t have significant pre-buy in this number,” he said, referring to the possibility that trucking companies will buy trucks in the coming months to avoid the new low-emission-engine technology scheduled for introduction in January 2007.

“We, of course, would like customers to buy as normal through this cycle,” Karlsten said, but acknowledged that with yet another round of technology changes on the horizon for 2010, carriers are looking at their options.

“A good half of them are saying ‘just continue on,'” said Scott Kress, senior vice president of sales and marketing for Volvo Trucks North America. “Just plod forward and not disrupt the maintenance cycle. That has lots greater financial implications.”

Volvo does not anticipate the large pre-buy followed by a significant drop in sales the industry experienced with the ’02 engines. “There’s going to be a deterioration, not a cliff event,” Kress said, but he admitted that the cost of the new technology, which is yet to be determined, will be a “big factor” in a carrier’s buying decisions. “We’re looking carefully at adding any capacity,” he said.

Projecting ahead to 2010, Karlsten said Volvo is working with both exhaust gas recirculation and selective catalytic reduction technologies. “We have both running in Europe today,” he said. “We can go either way but haven’t made up our minds yet.” He went on to say that in Europe, Volvo has seen better performance out of SCR engines.