Sterling Trucks: Getting it Wrong

According to a report on the demise of Sterling Trucks in the latest edition of Transport Topics the company was counting on a "pre-buy" of trucks in advance of the restrictive 2010 diesel emission standards to keep sales steady through 2009. When it became evident in recent months that the pre-buy wasn't going to occur as expected, Daimler Trucks North America decided to halt Sterling production in March, 2009, and concentrate on a "two-brand" strategy with their Freightliner and Western Star divisions. How could the company have gotten the pre-buy strategy so wrong? Didn't fleets pre-buy like crazy in advance of the 2002 and 2007 diesel emissions standards? Well, there's an interesting irony there... I can still recall the Freightliner press conference at the Mid-America Truck Show in Louisville where Daimler executives announced the company's strategy for using selective catalytic reduction (SCR) with urea--or, as it's now called, "diesel emission fluid," or DEF--to meet the 2010 EPA emissions standards. The Daimler executives were on the spot, red-faced and panicked, scrambling to defend their controversial strategy to a group of deeply skeptical journalists (myself included). At the time, it seemed like a foolish approach, catastrophically wrong, but over the past 18 months, as most other truck & engine OEMs have fallen in line with the SCR-DEF approach, Daimler had been starting to look downright visionary. When word started to circulate that EPA '10 engines with SCR and DEF systems would actually get better fuel economy than the EPA '07 engines, the mood in the industry started to shift perceptibly. In fact, it's now evident that the expectation of better fuel economy in 2010 engines has prompted a lot of fleets to delay their new truck purchases until then... That's right: instead of a pre-buy, this time there is going to be a "post-buy." Yes, there were undoubtedly other reasons for shutting the doors at Sterling, but ultimately Daimler Trucks' controversial decision to adopt SCR and DEF has helped to create a post-buy mentality, and contributed to the demise of one of their very own brands. What a way to go...

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