Volvo Spots Down Cycle Opportunities With VNL 860 Launch
VTNA's Koeck Says Fleets Will Only Push Older Trucks So Far, but New Equipment Needs Strong Return on Investment
Key Takeaways:
- Volvo Trucks North America highlighted its redesigned VNL model at a Sept. 23 event as fleets delay purchases amid a prolonged freight market downturn.
- The truck promises up to 10% annual fuel savings, worth about $5,500 per unit, but sales face uncertainty from tariffs and pending EPA emissions rules.
- Company officials expect a clearer outlook for 2026 by mid-December, with production adjusted to current demand and confidence that fleets will eventually renew aging trucks.
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MOUNTVILLE, S.C. — Launching a new truck during a market downswing brings with it hurdles, but Volvo Trucks North America believes its recently redesigned VNL over-the-road model is packed with features that can help its customers navigate the trucking industry’s challenging market dynamics.
“Our customers need to earn some money [with] our trucks, which means that we — whatever we do — we need to contribute to our customers’ bottom line,” said Magnus Koeck, vice president of strategy, marketing and brand management at VTNA, during a Sept. 23 media event held to spotlight the truck’s features.
VTNA launched the redesigned VNL last year following a development process centered on safety, efficiency and driver comfort. But it entered a freight market beset by a prolonged downturn and a broader, persistent economic malaise that has stalled recovery and kept fleet buyers on the sidelines.
A look at the new VNL's sleeper cab. (Connor D. Wolf/Transport Topics)
MORE: Volvo VNL Offers Restful Night, On-Road Performance
“Fleets are aging their population of units because of the uncertainty, the macroeconomic factors,” Koeck said. “What’s going to happen with the economy? What’s going to happen with the tariffs? Are the trucks going to be more expensive? Will the tariffs go away, will they not? We still don’t know. It’s very hard as an OEM, of course, to navigate through this.”
That said, Koeck understands that opportunity exists to sell trucks even in a down market. There are limits to how long fleets care to keep pushing older trucks, he noted, but acknowledged that any outlay for new equipment must be accompanied by a compelling return on investment.
The camera system on the new VNL. (Connor D. Wolf/Transport Topics)
“Maintenance and parts get more expensive, of course, when [trucks] get to 8 or 9 years old,” Koeck said. “We claimed when we launched this vehicle last year that you will save up to 10% in terms of fuel per truck, per year. With the present diesel price, that equals $5,500 per unit if you drive 120,000 miles. You also save lots of [carbon dioxide].”
VTNA and all manufacturers have been working toward implementation of stricter greenhouse gas emissions limits the Environmental Protection Agency set to take effect in 2027. Under President Donald Trump, those rules are now being reconsidered.
An expected pre-buy of trucks leading up to those rules never materialized, and with a pause on them now in effect, more uncertainty is in the cards.
“We are working very close to the authorities, of course — the EPA, and the administrators there,” Koeck said. The company, he said, simply wants clarity so that it can chart a path forward.
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“Just give us something so we know what we can play with,” he said. “The hardest thing is not knowing what prerequisites you have.”
Koeck acknowledged that this downturn is one of the toughest he’s seen in his 37-year career and followed a post-pandemic stretch when demand for trucks outpaced available supply and manufacturers struggled to keep up.
In the near term, Koeck is hoping for some year-end clarity on what lies ahead for trucking.
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“Mid-December we will have a very good outlook of what next year is going to bring us, at least the first six to eight months,” Koeck said. “But we are on a lower level — a significantly lower level here — when it comes to orders.” He noted that VTNA and its Class 8 competitors have all adjusted production output to match demand. Existing inventory is sufficient to accommodate an upswing in demand. “There is inventory at the dealers,” he said. “We are in very good shape there.”
Koeck stressed that the industry will eventually bounce out of the downturn.
“We will come to a point, inevitably, that they will have to replenish and renew their fleets,” Koeck said of VTNA’s customers. “So we’ll see. It’s a big unknown, and of course, lots of uncertainty.”
“We aspire to grow a lot here in North America during the next business cycle,” he added. “We can’t, of course, time the market.”
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