Strengthening safety regulations and shifting market dynamics in the trucking industry have been key drivers impacting the mature and highly-competitive brakes market. Today, suppliers must offer a wide variety of braking product options to end users to meet their unique operating environments.
Among the emerging underlying forces driving the commercial vehicle brake market’s competitive dynamics in disc brakes penetration are lightweight components and the growing off-shore component market.
A More Familiar Technology
In North America, brake drums remain the preferred choice and a more familiar technology among fleets, maintenance technicians and end users.
Brake drum technology has consistently been the standard option offered when purchasing an on-highway tractor or semitrailer. However, over the past few years, air disc brake (ADB) penetration has started to gain traction in the market, particularly for severe operating duty cycles (transit buses) and transporting risky cargo (tanker trailers).
Fleets are beginning to understand the primary performance benefits that ADBs can have on their equipment—from improved brake stability and reduced brake fade, to a lighter-weight design.
Though these benefits are an improvement from brake drums, mass ADB adoption is not expected in the near future as installation rates are projected to only rise 5 percent to 10 percent over the next five to seven years from its current market penetration of 8 percent to 10 percent.
Moreover, the high initial cost is approximately $500 to $1,000 per axle more than drums. Consumer continued familiarity with drum brake technology and sub-par aftermarket maintenance practices have ultimately hindered the mass adoption of ADBs.
Tier-I suppliers and equipment OEMs have shown an increased emphasis on producing efficient and lightweight offerings to help combat the strengthening government regulations. Brake components, especially drums, are being designed with reducing form factor and weight in mind without compromising the drums integrity.
Another factor helping drive this weight reduction trend is the fleets’ willingness to pay between two and 15 dollars extra per pound saved from using lightweight wheel-end components.
This could lead to an increasing demand for lightweight wheel-end components, especially for freight companies who “weigh out” instead of “cube out.”
Imported Brake Components
The recent economic stagnation, combined with the ever-increasing operating costs impacting all market participants, has opened up the door to low-cost foreign import brake components.
The penetration of these off-shore products has made significant headway in taking market shares away from domestic brake component suppliers.
Fleets are constantly faced with a difficult decision when spec’ing their equipment as cost savings has become crucial in today’s market. Fleets regularly need to compromise to the substandard quality and performance attributes of off-shore products to lower overall costs.
In order to fight these low-cost off-shore products, leading Tier-I suppliers are implementing the “good, better, best” strategy towards their product line offerings. This has started an interesting trend where demand has increased for the middle-tier components.
Price sensitivity in North America remains high and will continue to significantly influence the buying decision of end users.
Wallace Lau is a senior research analyst for Frost & Sullivan’s Automotive & Transportation Commercial Vehicle research practice. He focuses on monitoring and analyzing emerging trends, technologies, and market behavior in the commercial vehicle space. Frost & Sullivan (www.frost.com) works in collaboration with clients to leverage visionary innovation that addresses the global challenges and related growth opportunities that will make or break today’s market participants.