Improving market conditions

In 2010, the total market for heavy-duty trucks in North America increased by 20% to 142,096 trucks, compared to 117,983 in the previous year. Demand in general continued on an upward trend, largely spurred by the need to replace the aging population of heavy-duty trucks. A notable exception was the construction segment of the market, where ongoing weakness remained a challenge. Both Mack Trucks and Volvo Trucks in North America continued to capitalize on the increasingly positive response of customers to the new SCR-equipped trucks. Volvo Trucks grew its 2010 U.S. Class 8 market share almost two full points to 9.6%. Mack Trucks, despite an extremely low market for the dump and mixer trucks that are core to its business, finished the year with a U.S. share of 8.6%, more than a half a point higher than in 2009. In 2011, the North American market for heavy-duty trucks is expected to reach a level of about 220,000 trucks. The previous forecast was a level above 200,000 trucks.

In 2010, the total number of registrations in Europe 29 (EU, Norway and Switzerland) increased by 8.4% to 179,185 heavy-duty trucks (165,269). The recovery of European truck demand is split into north vs. south and larger fleets vs. smaller fleets and owner/operators, where the former in general is stronger than the latter. The main drivers of demand are the northern and central parts of Europe, where markets such as Germany and Scandinavia have showed good progress. In general, demand is higher in the long haul segment, whereas activity in the construction segment remains low in many markets. Volvo Trucks increased its share of the European heavy-duty truck market from 13.2% in 2009 to 14.2% in 2010 while Renault Trucks market share declined from 10.6% to 10.2%. In 2011, the total market for heavy-duty trucks in Europe 29 is expected to increase to about 220,000 trucks. The previous forecast was a level above 200,000 trucks.

Demand in Russia has recovered strongly from low levels, and is set to show continued growth across all segments.

In South America, the Brazilian heavy-duty truck market continues to be strong, primarily driven by favorable macro economic development but also supported by incentives such as subsidized financing. The total market in Brazil increased by 64% to 109,760 heavy-duty trucks in 2010 (66,950). Volvo increased its share in the heavy-duty segment from 13.0% in 2009 to 14.8% in 2010.

In India, the market for heavy-duty trucks rose by 69% to 211,543 trucks (125,173) according to preliminary statistics. The Group’s largest market in Asia is Japan, where the market for heavy-duty trucks was 24,453 vehicles in 2010 (18,889), which was an increase of 29%. UD Trucks’ market share for 2010 was 22.2% compared to 23.3% in 2009. The total market for heavy-duty trucks in Japan is expected to grow by approximately 10% in 2011.