Defining Production

Fleets frequently ask truck makers when a truck will be in production. Unfortunately, the term “production” is not strictly defined and can mean different things to different OEMs, customers, regulators, media and the public. There is no one definition for production beyond being a point in time where a new product comes off of a production line and is commercially provided to an end use customer.

The maturity of the product at that point may vary significantly between OEMs. That maturity includes the level of risk the customers assume that the vehicle they are purchasing will be configured for and operate as needed for their specific duty cycles. That risk will be measureable, after-the-fact through on-going maintenance costs, warranty claims, downtime measurements, number of product recalls, number and frequency of software updates (whether over the air or in shop), life of product, etc.

It is relatively easy to create “show” trucks for public events and low volume prototypes for limited track and road testing as a judicious application of money, priority and people can get one to a few built in six weeks to six months. Commercial production trucks, however, to be legally and safely classified as “production,” can take years (four to six years is common).

Conclusions

  • Many definitions exist for a statement by truck builders that they are in production causing confusion with stakeholders.
  • Product development is an investment in a new product that reduces collective risk over time through testing and decision making.
  • There are dramatically differing situations for established versus new OEM entrants, including such items as established development processes, revenue needs, variation of product offerings and risk acceptance levels.
  • Fleet expectations for cost of operation, performance, reliability and durability, etc. will not change and in fact be more demanding.

In the end, whatever changes the future reveals in OEMs launching new products, fleets will continue to expect to operate their products with acceptable uptimes, improved safety and low cost of operation. The OEMs that place too great a burden on fleets by introducing immature products will lose out in the long run to more robust ones. Fledgling new technologies risk slower adoption as well if immature products have poor real-world performance due to companies accepting greater risk to achieve near-term cash flows.