Market Overview

Last-Mile Driving Change For Truck Body Builders

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Last-Mile Driving Change For Truck Body Builders

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COLUMBUS, Indiana. As e-commerce has grown and customer demands have changed, medium-duty truck makers have had to respond. That has included ramped up production to meet capacity needs, but it has also meant innovations to assist the driver of whom more is being asked.

"The person driving the truck also has to deliver the product," explained Carrie-Ann Flank, vice president of sales & marketing for Morgan Corporation. "They have to bring things into the homes and get in and out of vehicles."

Morgan is a body builder, a so-called upfitter, and it has been working to innovate those medium-duty truck bodies to meet consumer and fleet needs.

"You would think it is just a box," Flank said of the bodies, "but there is a lot of innovation in it."

Unlike truckload freight, last-mile delivery comes with special challenges, including the fact that no two deliveries are the same. It could be a couch, an Amazon package, or a food order, and the vehicle to handle each of those items needs to be as unique as the delivery itself. The biggest challenge right now is the explosion in delivery of large and bulky items such as furniture, and grocery delivery.

"Most of your typical delivery companies don't want to deliver these items, so more and more transport companies are getting into this space," Flank said, noting that overall e-commerce spending is growing double digits each year but remains only 9 percent of overall retail sales. Because of this, "Morgan is really bullish about the medium-duty market and the last mile," she said.

The company is building a new plant in Orville, Ohio, and is looking at building several more in strategic locations around the country to help lessen the burden on existing plants, some of which have 120-day backlogs for upfits.

The home delivery grocery market is set to explode, Flank said, growing to $100 billion by 2022 with 70 percent of consumers expected to order groceries online by 2025. Morgan is preparing for that with new refrigerated bodies that offer multiple chambers with options to offer refrigerated, frozen and dry goods on the same vehicle.

Flank said she has even heard of customers who want to order steaks and produce on the same vehicle that also delivers the grill necessary for the cookout.

To ease the driver's task, Morgan recently introduced "pullout steps" on some of its bodies. These steps pull out from the side of the vehicle to make it easier and safer for the driver to step down from the van body.

Another innovation has been the "rear ramp door." Unlike a walk ramp, the ramp door extends the width of the vehicle and folds down, giving drivers more room to navigate orders going to and from the vehicle. The ramp door is also now being offered as a side door option.

Innovations from Morgan and others in the medium-duty space are seeking to take advantage of the opportunity that exists due to e-commerce. Unlike their Class 8 brethren, medium-duty trucks should continue to see solid sales going forward, explained Steve Tam, vice president of ACT Research.

In Class 4, year-to-date sales have outpaced 2018's totals, 1,810 to 1,412, and 2018's full-year total of 22,606 units bested 2017's 20,659 units. In 2016, Class 4 sales were 15,663.

Class 5 numbers tell a similar story, with year-to-date totals of 7,267, just ahead of last-year's pace of 6,880. Full-year 2018 totals were 93,744 units, up from 91,141 in 2017 and 82,285 in 2016.

Classes 6-7 are nearly identical to 2018's year-to-date totals, at 13,099 in 2019 versus 13,084 in 2018. There were 169,142 Class 6-7 vehicles sold in 2018, up from 156,761 in 2017 and 151,878 in 2016.

Image sourced from Pixabay

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