Wednesday, June 12, 2013
Faced with a rapidly changing global market, the product development team at UD Trucks is working hard—and rapidly—on ways to dramatically change how the company will serve a wide variety of customers in many different markets around the globe.
For most of its history, UD Trucks focused on producing trucks in Japan for the Japanese market, and in exporting from Japan to Asia and the rest of the world. While this worked well for many years, today the company finds itself in very different markets, in Asia and elsewhere.
Along with aggressive European and Japanese rivals, new low-cost competitors from China and India have entered the picture. Customers have a whole new range of choices as they try to find the right balance of price, performance and total cost of ownership.
Loic Mellinand, Senior Vice President, UD Trucks Global Brand, is the man in charge of trying to navigate these challenging waters. Based at UD Trucks’ headquarters in Ageo, outside of Tokyo, his responsibilities include building and implementing the global UD Trucks brand, as well as laying out the product strategy for the UD Trucks of the future.
His focus is not exclusively on Japan, but on the global market—or, more accurately, a number of local markets worldwide. The new strategy is a global approach, aimed at developing dedicated products for different markets, and customers with different needs.
“I can promise that these products will be something that we can be proud of offering to our customers.”
Loic Mellinand, Senior Vice President, UD Trucks Global Brand
“We have an aggressive growth strategy for Asia and other fast-growing regions and believe that UD Trucks will be vital for the Volvo Group’s ambitions since it already has a good reputation as a dependable truck brand and have been successful in a number of these markets for a long time”, says Mr. Mellinand.
The dilemma, as Mr. Mellinand points it out, is the variety of customer needs from a global perspective. It is clear that customers in mature markets with complex legislation, like Australia, Japan and South Korea, have different needs from customers in growth markets like South Africa, China and Indonesia.
“We have taken on this challenge within the UD Trucks brand and started to develop a new truck range several years ago, with the right specifications for customers in growth markets. We are nearly ready for launch.”
While Mr. Mellinand is reluctant to reveal details about the coming truck, he is certain of its competitiveness. The team has focused on excelling in fuel efficiency, reliability and uptime—features that are essential to customers’ profitability. “The great advantage of being part of a global company becomes fully expressed in an industrial project like this. We can use the local knowledge about our customers to understand their needs, the strength of global production and technology and UD Trucks—a brand with very strong Japanese heritage. We say that our new truck is the best of three worlds.”
He emphasizes UD Trucks’ strong history—because, he says, you need a clear vision of the past to be able to set out on the road to the future.
The UD Trucks brand was first launched in 2010, although “UD” has been part of the brand for more than 60 years. “Many of the things we are dealing with today go back far before the Volvo Group became involved in UD Trucks,” Mr. Mellinand says. “I see myself and my team today as part of the entire history of the brand.”
A key to being able to take part of community development in fast-growing economies is, of course, offering transport and construction companies vehicles and services that are affordable. Accordingly, the new approach also involves a major operational shift from Japan to Asia. Production for Asian markets will be placed in Asia.
“The shift of production is a prerequisite for being able to offer our customers outside Japan and in other mature markets trucks and services designed exactly for their needs,” says Mr. Mellinand. He stresses at the same time that this doesn’t mean that UD Trucks is ignoring Japan, or moving all of its production out of its home—and largest single—market.
“We do want to have a product that is designed for Japan, so I’m not talking about taking a product that was designed for Asia and bringing it into Japan. Instead, we want to provide a product that meets the expectations of Japanese customers.”
Tomorrow will be exciting, Mr. Mellinand promises, for customers as well as for the people who design, build and sell UD trucks. “I can promise that these products will be something that we can be proud of offering to our customers.”
“The shift of production is a prerequisite for being able to offer our customers outside Japan and in other mature markets trucks and services designed exactly for their needs.”