Imports Pick Up the Load : Fuel-Efficient Mid-Sized Truck With Larger Capacity Delivers for U.S. Companies
Dunn Edwards Paints had a problem. The Los Angeles-based firm’s pickup trucks just didn’t have enough payload capacity for heavy local deliveries.
Pomona Valley Express of Inglewood needed a truck with better fuel economy. Its gasoline-powered fleet was increasingly expensive to operate.
The answer for both companies lay in a type of truck virtually unseen on American roads until this decade. They both bought medium-sized, imported trucks that have become increasingly common for inner city deliveries and along the freeways.
Sold in other Pacific Basin nations for years before hitting U.S. shores, the trucks are primarily exported from Japan, but Europe and Brazil have also tapped the market. Japanese brands include Hino, Isuzu and Nissan Diesel. They compete directly with Italian-made Ivecos.
The latest Japanese-made entrant on the West Coast is Mitsubishi Fuso, which ceremoniously rolled off its first load of trucks destined for the Southern California market in the Port of Long Beach recently.
Having started its operations on the East Coast two years ago, Mitsubishi Fuso Truck of America is attempting to expand.
“We’re pleased to service this important West Coast market. This shipment is a tangible demonstration of the (company’s) commitment to have nationwide truck distribution,” company President Kenji Haga said.
Spokesman Thomas S. Neil III said California sales “will represent, if things go well, 20% to 30% of sales overall.”
Major U.S. manufacturers have gotten into the act, too, importing vehicles and selling them under their own nameplates.
In the wake of trucking deregulation, which has forced shipping firms to buy fleets that minimize wasted space or power, foreign manufacturers have found a ready market for a fuel-efficient, city delivery truck that is larger than a pickup but smaller than a tractor-trailer combination.
Sales are soaring, bolstered by the snoutless cab-forward design that increases maneuverability in congested city traffic, economical diesel engines and an increasingly service-dependent economy that depends on quick deliveries.
Retail sales of imported medium trucks, defined as those of more than 10,001 pounds and less than 33,000 pounds gross vehicle weight, increased about 32% between 1986 and 1987, according to the Motor Vehicle Manufacturers Assn. in Detroit.
The demand has sparked increased competition. From Italian-made Iveco’s sole entry in the market in 1983, the number of models offered by all manufacturers ballooned to 17 by 1987 and to 29 this year, said Todd Bloom, vice president of marketing for Iveco Trucks of North America in Blue Bell, Penn. He said the number of models is expected to climb to 38 in the near future.
The success has not been lost on major American manufacturers. Ford is importing its Cargo model from Brazil, and a spokesman said sales are brisk. General Motors is sticking its nameplates on imported Isuzus. Navistar, maker of International trucks, is importing Nissan Diesels. Mack is selling medium-sized trucks in conjunction with Renault of France.
So far, however, American manufacturers have balked at producing their own cab-forward, diesel trucks domestically, although they produce an array of intermediate-sized “conventional” models. Despite their sales gains, imports hold only 10% of the total market for medium trucks, said John McDonald, spokesman for Navistar International Transportation Co.
“What you’re talking about is a small segment of the market. When does it become economically feasible?” McDonald said, noting that there are “13 (other) competitors in the marketplace. If you sell 2,000 vehicles, how do you justify $60 million in development costs?”
The top-selling importer of medium-sized trucks through the end of July was Isuzu Truck of America, according to the Motor Vehicle Manufacturers Assn. But its market share among 14 competitors was only 19%. Ford and Mack Trucks Inc. were the only others to hold more than 10%.
The trucks are designed for urban use. While popular in Japan, Europe and Third World countries for years, they are enjoying growing popularity as American cities become more congested. With the engine underneath rather than in front of the driver, they are more compact than other medium-size trucks. They have short turning radii and good driver visibility. Their diesel engines not only are cheaper to operate, they last longer than gasoline engines.
“The vehicle has a strong appeal to drivers from the point of view that the cab is very quiet and operation of the vehicle is very much like an automobile,” said John Hanrahan, vice president for sales and marketing for Hino Diesel Trucks (USA) Inc. in Orangeburg, N.Y.
They sell cheaply enough to appeal to small merchants who have outgrown their pickup trucks or vans. Some models sell locally for less than $17,000, including the cargo box.
Yet for all their advantages, Iveco’s Bloom said, the vehicles were referred to by his company as “the phantom class” as recently as 1983--underscoring how the industry had failed to meet the demand for that type of truck.
“We thought with the changing fiber (of the economy) from manufacturing industries to service oriented there would be a tremendous need for delivery trucks,” he said. Their popularity has extended beyond making deliveries. Some have found uses as varied as towing, serving as mobile satellite relay stations and as utility trucks, he added.
Dunn Edwards started replacing its Ford pickups with Ivecos and Isuzus that have been converted into flatbed trucks eight years ago to deliver paint and supplies from outlets in California, Nevada and Arizona to customers. “Our biggest concern was payload,” said store supervisor Gary Gilb. The pickups did not have enough capacity to haul heavy loads, he said.
Larry Hoggard, president of Pomona Valley Express, said he is pleased with the two Ivecos he has tried out and plans to gradually change over his delivery fleet of 24 gasoline-powered Ford medium-size trucks.
“They are a lot better on gas,” Hoggard said, adding that he believes switching to diesel will cut his fuel costs by one-third. “That’s a lot of money in the course of a year.” He said his trucks can run about 30,000 miles each a year.
Southern California truck dealers say sales are brisk.
Russ Bauman, general manager for Prince Truck Center near Los Angeles International Airport, said many Mitsubishi Fusos and Ivecos on his lot are being snapped up by firms looking for the size of truck of that fits their needs exactly.
“The wrong truck will cost somebody a lot of money,” Bauman said. “You have to have a truck suited for how they are going to operate.”