Paccar’s Plimpton addresses HDD; company receives J.D. Power Award

Speaking at the opening session of Heavy Duty Dialogue ’09, Tom Plimpton, vice chairman of Paccar Inc., provided insights into the heavy-duty trucking industry. Amid all the relative bad news, there is some good news. “The good news is that fleet age is at the highest it has been in 20 years,” Plimpton said. Older trucks consume more parts and need more service, which is good news.

Because the trucking industry is a vital part of the economy, it will rebound. “We must be poised and ready for that rebound,” Plimpton told HDD attendees. Plimpton explained that Paccar’s strategy is to be ready with the products and services that are going to be needed to meet the expectations of tomorrow’s customers.

He said manufacturers and suppliers have to be able to meet both OE and aftermarket requirements. To facilitate this, Paccar is making investments in its suppliers. He believes that manufacturers and suppliers have to work jointly to control cost and invest in global sourcing of products as well as have long-term material contracts to avoid spikes in the cost of raw materials. He sees global parts sourcing as a key growth area and said that Paccar Parts has $2.3 billion in parts sales last year. “We want to provide the right part at the right time at the right price.”

Paccar Parts provides both branded and private branded products, and Plimpton explained that private branding represents an opportunity for suppliers to partner with Paccar.

Paccar has positioned itself as a technology company, Plimpton said. “Technology is not something we add on — it is something that we do.” The company’s hybrid vehicles and components with better fuel economy are some examples of how it uses technology.

Regarding the upcoming 2010 emissions, Plimpton explains that Paccar’s “2010 solution is ready to go” and that the company has chosen selective catalytic reduction because it sees it as “the most economical and reliable solution.” While he admitted that Paccar was the last truck OE to have a proprietary engine, he believes having one now “is a tremendous win for us because now our customers can have an integrated product.”

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He added, “Vertical integration is a tremendous opportunity for suppliers. We believe an integrated product will increase our market share.”

Also at HDD, the J.D. Power and Associates Founder’s Award was presented to Paccar for its longstanding commitment to customer satisfaction in the commercial vehicle industry. Gary Dilts, senior vice president of global automotive operations at J.D. Power and Associates, presented the award to Plimpton.

“We are very proud to be the venue for J.D. Power and Associates honoring of Paccar,” said Tim Kraus, president and chief operating officer of the Heavy Duty Manufacturers Association. “Our members were thrilled to be on hand to witness the presentation of the Founders Award to Paccar at Heavy Duty Dialogue.”