work will result in less passing, quicker braking, and fuel savings of about 10 percent for the following trucks and a smaller gain for the lead vehicle, according to Daimler. And it will help reduce congestion. When a human is at the wheel, a truck in some countries must maintain a distance of about half a football field from the vehicle in front of it to stop safely in an emergency. With automation, that distance shrinks to about 50 feet. “Traffic on the whole will become calmer,” says Andreas Renschler, who heads the Scania and MAN truck brands for Volkswagen.
Manufacturers expect platooning to start taking off in 2020. Most trucks made in the past decade have sensors that alert drivers when they wander out of a lane or get too close to the vehicle ahead of them, relying on cameras and radar similar to those found in high-end Mercedes-benz and BMW sedans. Adding automated steering and braking wouldn’t be complicated, vehicle makers say. Lori Tavasszy, a logistics professor at Delft University of Technology in the Netherlands, says half the European fleet of big rigs— 750,000 trucks—could be platoon-ready by 2025. “The technology for this is there,” says Erik Jonnaert, secretary general of the European Automobile Manufacturers’ Association. “The bottleneck is regulation and how it can be deployed commercially so freight companies pick it up.”
In Brussels, lawmakers are considering Europewide regulations for things such as the minimum legal distance between vehicles—164 feet in Germany, but simply “a safe distance” in the Netherlands—and adopting standard rules about dissolving platoons at busy highway junctions. On April 14 transport ministers, the European Commission, and industry representatives agreed to cooperate on connected and automated driving, focusing on traffic rules and making testing easier. Close cooperation “is needed if we want a wide-scale introduction of platooning,” says Harrie Schippers, who heads DAF Trucks, the European unit of Paccar, a manufacturer based near Seattle.
In April’s dry run, six convoys of two or three trucks each—including Kropp’s—traveled to Rotterdam from Sweden, Germany, and Belgium. Three Scania trucks covered the longest distance, starting near Stockholm, crossing the 10-mile Oresund Bridge and tunnel to Denmark, heading south to Germany and then into the Netherlands. Each caravan in the test completed the journey as a unit, but manufacturers envision convoys forming on an ad hoc basis, with drivers following a leader for anywhere from a few exits to hundreds of miles as individual vehicles pull off to make deliveries or take alternate routes to their final destinations. Daimler says cars seeking to leave the highway can effectively nudge their way into a convoy: The truck behind recognizes the interloper and increases its distance accordingly, then closes the gap once the car exits. If a vehicle pulls out in front of the first truck, the lead driver hits the brakes and the followers begin to slow almost immediately.
Even though the initiative started in Europe, the manufacturers say platooning may be even more relevant in places with wide-open roads such as Australia or the western U.S., where distances traveled are greater. “The event in Rotterdam really broke the ice,” says Odile Arbeit de Chalendar, an official of the Conference of European Directors of Roads, who helped set up the April test. “For the first time, we put platoons on the road, in real traffic, across borders, and long distance.” �Elisabeth Behrmann
The bottom line Manufacturers say the technology for convoys of semiautonomous trucks can lead the way to driverless vehicles.
sports-performance brand—with energy drinks, Ronaldo-branded supplements, and a leaf-shaped logo he hopes will become as recognizable as Nike’s swoosh. Herbalife declined to comment for this story.
The sports push, which has included soccer stars David Beckham and Lionel Messi as endorsers, has helped the company expand beyond the U.S. into soccer-obsessed Latin America and Europe, despite a whirlwind of bad press about its business model. “If you see Herbalife on David Beckham’s shirt, that makes you believe it is something credible and legitimate—something you can trust,” says Andrew Holland, engagement manager for brand strategy consultant Vivaldi Partners Group.
Hedge fund manager Bill Ackman has spent three years and more than $50 million trying to convince investors that the company is an illegal pyramid scheme. Ackman’s campaign, which he began after betting $1 billion against Herbalife’s stock, has been beaten back by not only the company’s vigorous denials of the allegations but also the credibility of its brand ambassadors. Herbalife has endorsement deals with 40 teams and 80 athletes, and its popularity has helped it keep recruiting people to resell its teas and vitamins. It’s added 800,000 so-called distributors since Ackman began making his allegations in December 2012, lifting the total to 4 million at the end of 2015.
Ronaldo, with more than 100 million followers on social media, is a potent weapon. Before Ronaldo, Herbalife featured Messi, arguably the biggest star of the world’s most popular sport, and for five years had its name emblazoned on Beckham’s Los Angeles Galaxy jersey.
Today Herbalife’s endorsement deals include an Indian cricketer and a Malaysian squash player. There’s an Israeli women’s basketball team bearing its name—herbalife Ramat Hasharon—an off-road racing squad from Peru, and handball players in France. All this marketing comes at the relatively skimpy cost of only about 1.5 percent of its $4.47 billion in sales last year. Consumer giants Nike and Procter & Gamble dedicate about 10 percent of revenue to marketing.
Ackman has complained that Herbalife’s success can be attributed to consumers seeing it as a legitimate enterprise because of its relationship with Ronaldo, Messi, and other public figures it’s employed, including former Secretary of State Madeleine Albright and Antonio Villaraigosa, former mayor of Los Angeles. “The best pyramid schemes try to recruit credible people to give them credibility,” Ackman said during a 2014 presentation in which he claimed Herbalife nutrition clubs run by distributors were a ruse to bleed money from poor consumers. Herbalife has defended the clubs.
Yet Herbalife’s endorsements mimic what brands have been doing for decades to connect with consumers. It’s targeting people in more than 90 nations, with a focus on Latin America. Other soccer deals include top clubs Barcelona, Mexico’s Pumas, and Brazil’s Santos FC (former team of the legendary Pelé). Spokesmen for Ronaldo, Messi, Villaraigosa, and the LA Galaxy didn’t respond to requests for comment. A representative for Albright’s consulting firm, Albright Stonebridge Group, declined to comment.
During Beckham’s 2007-12 Galaxy tenure, Herbalife’s sales doubled. Its distributor ranks also rose to 3.2 million from 1.5 million, with huge gains coming from soccer-loving nations. Explained Johnson in a 2007 investor call: “Adidas produced more than 600,000 Galaxy jerseys in its initial run, and everyone in every one of those is a mobile Herbalife billboard.” Apparently Ackman wasn’t listening in. �Matt Townsend
July 2007 Beckham’s LA Galaxy debut in an Herbalife-branded jersey June 2010 Herbalife signs deals with Messi and his club, FC Barcelona December 2012 Ackman launches campaign against Herbalife June 2013 The company signs Ronaldo to a five-year deal The bottom line Herbalife’s ties to soccer stars have allowed it to expand beyond the U.S. despite criticism of its business model.
treatment involves 20 to 30 tiny injections by a doctor, who must avoid the nerves and major blood vessels running under the jawline. Each session costs about $1,500, and most patients require two to four, says Dr. Anne Chapas, a dermatologist in New York. Her practice, Union Square Laser Dermatology, now performs about two Kybella treatments a week and expects to do more with the marketing push. “We were absolutely excited about it,” she says. “We know there’s huge potential.”
Kybella bolsters Allergan’s position in aesthetic treatments, an area Sanford C. Bernstein analysts forecast to grow 10 percent a year through 2020. Besides wrinkle-ending Botox, with $2 billion in 2015 sales, Allergan also sells dermal fillers like Voluma for dramatic cheekbones. Schaison already has a name for its needle-based trio of Botox, dermal fillers, and Kybella: the liquid face-lift. “Now we’re almost a one-stop shop,” he says. “We own the face.”
Schaison isn’t just on top of the business pushing no-cut facelifts; he’s also a client who got his Kybella treatment last June. “I was not bothered by my chin, but I wanted to experience it,” he says of the 10-minute procedure. “I absolutely loved the results.”
Kybella faces few rivals. The most popular alternative in the U.S., liposuction, can cost more than $6,000 and requires an incision, a few days in bandages, and occasional scarring. Unlike Botox, the effect of Kybella doesn’t wear off in a few months. That means the revenue stream is short, but the drug may have a broader appeal than many plastic surgery or dermatologic treatments. Allergan says Kybella in trials was effective for 80 percent of patients.
Elizabeth Krutoholow, a drug analyst at Bloomberg Intelligence, says Kybella could log $500 million in annual sales. Allergan says men could account for 30 percent of patients vs. 10 percent of Botox users. That figure may go higher if the company is successful in tests of the drug against another enduring beauty scourge: love handles. �Kyle Stock
Edited by James E. Ellis and Dimitra Kessenides Bloomberg.com Number of very small cars sold in Japan for which Mitsubishi Motors exaggerated fuel-efficiency figures. The carmaker is now investigating its mileage claims on cars sold in international markets. The bottom line Allergan’s Kybella drug to treat double chins could eventually bring in more than $500 million annually.
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