CEO statement

CEO statement

It’s time to act on sustainable transport

The world is moving ever closer to that inevitable point in time when sustainable transport solutions become the only viable option and a “new normal”. In 2017 Scania intensified its efforts to drive the shift towards a sustainable transport system.

In the past year, the ecosystem of transport and logistics has been moving in the right direction when it comes to acknowledging sustainability challenges. Demand for sustainable transport solutions is increasing, not only from our customers, but also from their customers —the buyers of transport services. Urban authorities are already prompting a switch to transport that uses biogas, battery-electric or other fossil-free energy sources. We welcome this development and are already working in partnership with our customers to understand what their customers need to fulfill increasingly tough sustainability targets. We work across boundaries with cities, operators and their customers too, taking the whole transport system into consideration in a systematic way.

The world can’t wait for a ‘one size fits all’ solution; the conditions and issues vary so much from place to place that there is no silver bullet. On the contrary, fossil-free, sustainable options should not be seen in competition with each other — all of them are better for our climate than the fossil fuels we have now. We urge authorities and institutions to enable and simplify the use of them all. We have solutions here and now!

We base our approach to sustainable transport on the three pillars of Energy efficiency, Alternative fuels and electrification and Smart and safe transport. The potential when combining these three pillars is huge. Increasingly energy-efficient combustion engines will continue to play a role in the transport system of the future, running on fossil-free fuels or combined with an electric powertrain. Vehicle electrification is developing quickly and with its environmental, social and cost benefits, it will play a fundamental role going forward. We are working full speed ahead on electrification with industry partners to solve infrastructure and battery capability issues for the technology to fulfil business requirements of heavy bus and truck customers. When optimising these transport and mobility flows in a smart way, using digitalisation and automation, we continue to reduce waste in the transport system.

Our aim is that wherever in the world you go to buy a Scania solution, you should be offered an alternative to a fossil-fuel vehicle. We are committed to making sustainable solutions our standard offer and fossil-fuelled the alternative.

A record year for Scania

2017 was a year of growth in our industry, and a record year for Scania. We have seen steady growth in nearly all regions throughout the world, with Europe continuing to perform strongly, a sturdy recovery in Russia and positive signs from Brazil. But perhaps the most encouraging area for us in the past year has been Asia. There we are starting to see that the Scania business model, focusing on total operating economy and vehicle uptime, is starting to resonate with customers, and we are increasing our vehicles volumes.

We have achieved record delivery volumes and maintained a strong profitability at the same time as introducing our new generation of trucks, the biggest industrial changeover in the company’s history.

“To achieve records during a great upheaval is testament to the enduring strength of our flexible production system and the amazing dedication of the Scania family — our 49,300 employees worldwide.”

While still in the midst of launching the new truck generation, the feedback from our customers on the quality and performance has been tremendously positive and we celebrate this success. With the XT construction and urban truck ranges this year, we have now presented all products in the new truck generation family. Our new XT range provides the construction industry with a robust, safe and energy-efficient production tool that delivers an increase in operational uptime of 5 percent. The urban truck range offers safe, clean and cost-effective city solutions, at a time when cities in Europe, Asia and Latin America urgently tackle serious issues of congestion, air quality and road safety.

“I think businesses that are not part of developing solutions to the sustainability challenges of our time will struggle to survive.”

Sales of gas, ethanol, biodiesel and hybrid electric-powered vehicles grew last year too, and we made a real breakthrough with the launch of a 13-litre Euro 6 gas engine for the long-haulage sector. This is a statement of intent and hugely important to accelerating the shift.

2017 was a good year for Scania’s buses and coaches and we strengthen our bus range for alternative fuels with the hybrid Interlink Low Decker and the battery electric Scania Citywide. The Soot-Free Buses initiative that Scania signed up to in 2017 will improve the lives of urban inhabitants worldwide with the usage of cleaner engines and renewable fuels — one of many examples of how it is necessary to work together across boundaries in the ecosystem to make a bigger impact.

Service sales too reached record levels and we continue to improve our range of services that enhance customer profitability, realising more and more of the immense potential of the big data we have obtained from our fleet of over 300, 000 connected vehicles. An increasing number of our customers are choosing Scania solutions for their finance and insurance and Financial Services reached record earnings this year.

Redefining Scania

If 2017 has shown that the move to sustainable transport is gathering pace and the market is responding, we still need to do much more to offset the impact of greenhouse gas emissions because even as the technology advances, so does global warming.

I think businesses that are not part of developing solutions to the sustainability challenges of our time will struggle to survive. For us the question is not whether a future of sustainable transport will come, but when. It is towards this future that we are working in close cooperation with our customers and customers’ customers.

Partnership is crucial in accelerating change. Besides the synergies that lies in sharing certain research and development within Volkswagen Truck & Bus, Scania is collaborating with a range of players within the ecosystem of transport and logistics, creating clusters of teams with key players, such as fuel and technology suppliers. Partnership equals leadership in the shift towards a sustainable transport system.

We are more determined than ever to fulfil our vision of driving the shift towards a clean, safe and reliable transport system. To make this shift happen, we are challenging ourselves, our customers, their customers, policy-makers and academia. We are developing our people by respecting and integrating the diversity that makes us who we are. We keep improving our profitability, reinvesting our resources on the people, services and solutions that improve our customers’ profitability, today and tomorrow.

I believe the true meaning of corporate responsibility is to see the world through a 360 degree perspective and take on that added layer of responsibility of a global citizen and a leader. We have made a choice to lead our ecosystem of transport towards sustainable transport and we stand by it. It’s time to act, and we urge others to join us.

Henrik Henriksson
President and CEO, Scania