Changing Heavy Duty Purchasing PatternsMon, 09/01/2014 - 11:00
The Mexican consumer market is dominated by American trucks, a preference obtained over the many years American vehicles have been present in Mexico. But in recent years, competition has been heightened by the entry of new players, leading to a reworking of consumer preferences. Hino is a relative newcomer, having begun sales in 2007, but its Director General, Harumasa Suzuki, quickly realized the importance of consolidating Hino’s brand image in order to penetrate the market. Currently holding a 5% market share, Suzuki hopes to double that to 10% by 2018 through marketing strategies tailored to the purchasing tendencies of Mexican customers.
Hino sees it as important to be closely associated to the positive attributes of Japanese OEMs, such as advanced technological capabilities, while portraying Hino as being adapted to the needs of the Mexican market. Being a Japanese truck company has allowed Hino to offer a more competitive price in the Mexican market. “A vehicle brand’s origin is no longer a key concern for clients as the most important considerations are total cost of ownership, performance, and maintenance. Hino trucks are not cheap compared to certain other brands, so we are trying to obtain a competitive positioning in Mexico without reducing the price of the products,” explains Suzuki. Hino has created three main strategies to increase its nationwide position. The first is a focus on improving customer service, achieved by increasing the number of service dealerships. “This does not necessarily mean increasing the number of dealers, but encouraging the existing ones to invest in service. The company currently has 18 dealership companies and 46 points of service networks, and expects to see an increase of 5-10% based on training people in local workshops and giving them a Hino inventory to become authorized service spots for us.” Hino presents the opportunity to later attract large fleets that use Hino vehicles as a major incentive to such workshops. To aid in this process, Hino gives its clients a list of authorized workshops that can provide maintenance for their units. The third strategy is comprised of training courses for client’s employees. This concept is called Total Support and was created to offer after-sale support to the customer. “These training sessions prepare the user to operate the units correctly and maximize benefits ranging from fuel efficiency to extending the lives of the units,” adds Suzuki. So far, 500 companies and more than 2,000 drivers have received this training, leading to a reported 31% fuel efficiency improvement. José Armenta, Commercial Director of Hino, says that “clients appreciate these concepts as a 31% fuel reduction creates a competitive advantage given the rising fuel prices seen in the last few years that have made it difficult for certain companies to survive. Hino’s programs like Total Support and Eco Drive help companies to continue thriving.” Having received the training, fleet companies can place Hino’s Eco Drive logo on their trucks, which serves to improve their brand image and strengthens Hino’s presence in the market.
Maintaining close ties with big fleet companies is important to Hino, both as a source of future sales and to road-test future services. Clients are happy to adopt Eco Drive but are more sluggish to adopt greener technologies like hybrid or electric vehicles. Hino recently launched its new generations of hybrid trucks and is targeting large fleets, as they are usually more environmentally conscious. “Hino has already sold ten units to PepsiCo, supporting its efforts to improve fuel efficiency and corporate image.” As this demand evolves, Hino expects sales for fleets of that size to reach between 30 and 50 units. “Nevertheless, many consumers still view hybrid technology as being very expensive and it will take some time to alter this perception,” adds Suzuki. Hino’s aim to double its market share in Mexico is predicated on expanding its product portfolio and entering new market segments, even if its hybrid and electric options are not taking off as of yet. “Hino plans on introducing its new urban and suburban bus offerings. We are trying to expand our product portfolio to increase volume and we want to give our dealer network more tools to increase Hino’s sales and presence in the market,” adds Armenta. This process is part of a transition in which the role of emerging markets like Mexico is changing for Japanese manufacturers. “At the moment, Hino’s headquarters in Japan are considering major changes to the way it produces. Mexico could become our manufacturing hub for the whole of Latin America and serve part of the US market,” concludes Suzuki.