CV industry’s journey in a post-pandemic period
The keynote address of Darrell Huntsman, CEO, Frost & Sullivan, as part of Apollo CV Awards 2021, provided a glimpse of how the CV industry will journey in post-pandemic period.
The keynote address of Darrell Huntsman, CEO, Frost & Sullivan, as part of Apollo CV Awards 2021, provided a glimpse of how the CV industry will journey in postpandemic period.
Beginning his keynote address by highlighting three things – recovery from Covid and the direction of economic recovery, adopting change and thriving, and the journey of commercial vehicle industry amid all this, Darrell Huntsman expressed that he is seeing a strong recovery globally on the economic front. Of the opinion that he is witnessing a strong rebound as the world comes out of the challenging year that 2020 was, Hunstman averred that he is looking at five to 5.5 per cent growth across economies globally. He added that different regions will drive different recovery patterns. Of the opinion that anywhere between three and 11 per cent rebound from region to region will be visible, Darrell said that US is likely to see a economical rebound of between four and 4.5 per cent. In Europe, the growth is looking to be between 4.5 and eightper cent, he quipped. Confident that China will continue to be a strong growth driver for the world economy at eight per cent, Huntsman said that India would see a nice growth spike of 11 per cent despite being hit hard by the pandemic. Terming as fantastic the continued growth in the world economies post an unprecedented Covid challenge in 2020, he mentioned that interest rates in most parts of the world will remain low. “They will remain low as governments provide a stimulus for businesses to re-invent themselves and contribute to the economic growth,” he added.
Of the opinion that low interest rates would be a way of governments to ensure continued investment in the manufacturing field among others, Darrell remarked that recovery will be visible in the consumption of crude oil. Emphasising that low interest rates as a way of governments to ensure continued investment in manufacturing and other fields would significantly influence new product development, he cautioned about some moderation in the production of crude oil. Stating that the trend involving a strong push to diversify out of China is particularly relevant for emerging
economies in 2021, Huntsman averred that the opening up of transportation will see an proportionate increase in the demand for crude oil. Remarking that the strong push to diversify out of China would be for manufacturing and other services, he drew attention to the rising labour costs in that country. Pointing at political challenges regarding China as a factor too, Huntsman said, “The Covid pandemic make it risky to have a single source of production in one country.” Stressing on companies continuing to diversify and choose other locations for manufacturing their goods, Darrell said that emerging economies could stand to gain from efforts to diversify out of China. Touching on the talk that there is a virus and it could be serious, he expressed that a complete lockdown of some of the global economies led to moderation in transportation. The workforce went home; they left their offices and began working from home,” he added. This changed the entire equation, Huntsman said.
WINDS OF CHANGE
Explaining that a lot of change has taken place since the lockdowns happened, Huntsman averred that the demand for vaccines made sure that many of them were developed. Many vaccine manufacturing facilities were developed quickly, he added. Speaking of the need to create an effective and efficient distribution network, Darrell said, “There is a need to get those vaccines to millions and millions of people.” Of the opinion that vaccines were quickly developed in the period of 12 to 18 months, he stated that it led to a significant amount of change. Stressing that change is a constant, Huntsman averred, “It is quite likely that change will bring more challenges and more challenges will lead to more opportunities.” Remarking that change should be embraced and seen as an opportunity, he added, “The three things that will drive change are the world population, demand and flow of information, and new technologies. Stating that world population will continue to grow and present an opportunity for each individual to contribute, Darrell expressed this would have a profound effect on productivity.
Explaining that demand for information, and its flow around the world is proportional to the population, Huntsman said that the need for information is poised to grow much faster than expected. He termed the development as the one where each individual rises together. “It is like having 7.8 billion mini computers, all of them thinking ‘innovatively’ and solving new problems. Of the opinion that the emergence of new technologies will allow societies to rise and increase the pace of change, Darrell expressed, “With higher productivity and more opportunities there are
now 7.8 billion super computers out there.” Expressing that the presence of 7.8 billion super computers is exciting and turbocharging, he said that the same may sound scary but is actually a good thing. “It is a good thing because of the potential it presents to bring people out of poverty,” he added. Stating that it is a development that looks at the aesthetic potential of everyone, Huntsman remarked that it also brings with it challenges like climate change, the ability to feed as many people, and to offer them the quality of life. “This is what the leaders should address,” he quipped.
FACTORS AFFECTING COMMERCIAL VEHICLES
Drawing attention to factors that affect commercial vehicles, like e-commerce, infrastructure and connected vehicles, Darrell expressed, “e-commerce will continue to be a driver of retail.” “It will be the driver or retail as new business models are born,” he added. Of the opinion that it allows democratization of goods and services, he remarked, “I could get products to reach any part of the globe from his home.” Emphasising on e-commerce having a significant effect on logistics and warehousing, Huntsman averred that it would also have a significant effect on forward logistics and reverse logistics. “On the infrastructure front, mega projects will need to be driven to enable the use of higher tonnage vehicles,” he added. Pointing at connected vehicles, he said, “These will improve safety and optimise goods transportation.” Confident that the change in infrastructure, and the increase in higher tonnage and connected vehicles will pave way for more data being accessed and analyzed, Darrell said, “Productivity improvement and fleet optimisation will be significant.” Of the opinion that governments will continue to be involved with such an amount of change, he stressed on the need to be aware of, and to understand the regulations put in place. “These would be for environment protection and the safety as well as the wellbeing of everyone,” he quipped.
Suggesting that the industry should involve in helping to guide the regulations, Huntsman averred that there will be a need to understand and comply with those regulations too. “The ability to help guide the regulations, be aware of them, and to understand as well as comply with them, will amount to being a good global citizen,” he added. Explaining that electrification at various levels of automobiles will continue to take place, Darrell termed it as inevitable. He mentioned that with infrastructure in place, electric vehicles will be found across applications and categories. Electric vehicles will mark a major shift, he added. Expressing that much action will take place in the area of driver-centric technologies too, Huntsman said, “This will improve safety, lower the maintenance of fleets and lower their costs.” “The cost of insurance, replacement parts and replacement of vehicles will dramatically alter,” he stated. Revealing that the effect of it will improve productivity, Darrell mentioned, “Technologies will help us to drive safety, and will better prepare us for the future.” “The focus will be on creativity and taking advantage of what is available,” he added. Of the opionion that attention will be on profit born out of a value chain where goods are produced and delivered, Huntsman said that attention will be also on how the advantage of that profit is derived.
Stating that value chain analyses will become more and more important for new business models, Darrell expressed, “Based on it, fleets may enter insurance business.” “They will have more data available with them through the use of connectivity than anyone else,” he remarked. Confident that the use of technologies like connectivity will provide fleets with better insight into accident prediction and prevention, he averred, “New and interesting business models will emerge as the economy rebounds.” Mentioning that he is excited about growth rebounding in 2021, Huntsman concluded, “This will have a positive impact on the commercial vehicle industry.”