Brand Extension Marketing Plan – Oshkosh Corporation

2.0 Situational Analysis

Oshkosh Corporation’s McNeilus® Volterra™ ZSL™ is a state-of-the-art design refuse
collection truck with unbeatable features, including zero emissions, integrated body-chassis
design, advanced lithium-ion batteries, high-tech driver assistance systems (radar system and
360-degree camera) for advanced visibility and comfort, 8% larger cockpit size, and cost
efficiency. The truck is primarily targeting garbage and waste management companies and
municipalities to keep up with emerging trends of sustainability and new legislation grounded on
green solutions. However, succeeding in the refuse truck industry will not be a walk in the park
for the McNeilus, as competition is mounting from strong brands like BYD’s 8R Electric Truck
and other startups. Long-term triumph will require addressing weaknesses and threats and
leveraging capitalizing on strengths and opportunities.
2.1 Market Summary
For Oshkosh Corporation, the newly electric-powered McNeilus® Volterra™ ZSL™ is a
cutting-edge product that promises to revolutionize the refuse collection sector with zero
emissions, cost efficiency, noise reduction, integrated design, enhanced comfort (ergonomics),
and more safety. It targets garbage and waste management firms and municipal departments keen
on addressing environmental issues and complying with the new stricter legislation. The sector is
projected to grow by over 30% within the next decade, driven by three core market trends: the
emergence of smart/green cities, the push to electrify commercial fleets, and renewed emphasis
on sustainable organizational practices through stringent policies.
2.1.1 Market demographics

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The primary target market groups are refuse/garbage collection firms interested in adding
fully electric garbage collectors to their fleet, complying with environmental regulations,
lowering operational costs, and supporting sustainability efforts through zero-emission
automobiles. Therefore, the main target market groups include private waste management firms
and municipal/city council waste management departments. Based on recent market trends and
the increased regulatory environment, I expect the market to grow by over 30% within the next
decade.
2.1.2 Market needs
The McNeilus® Volterra™ ZSL™ is unquestionably a revolutionary product with a
greater potential to address the rising need for cost-effective and environmentally friendly waste
management solutions, including garbage collection trucks (Manthey, 2023). With climate
change and global warming taking the world’s center stage, there has been an increased need for
sustainability practices among various stakeholders (the public, garbage collection and waste
management firms, regulators, and environmentalists) in waste management, especially garbage
collection, and industry. This need has been driven by the passage of stringent environmental
legislation and heightened public expectations for efficient and sustainable practices. Today,
operational efficiency is considered a prerequisite for waste management firms; they must
operate at a lower cost, comply with new regulations, and make profits to stay afloat. Drivers are
also increasingly demanding safer trucks and better working conditions – some critical factors
influencing turnover and retention rates in the sector. These needs have been established through
a multimodal approach that combines industry trends, customer feedback, extensive market
research, anecdotal evidence from experts, and regulatory developments.

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The McNeilus® Volterra™ ZSL™ is perfectly designed to address these specific current
and evolving needs by guaranteeing, among others, zero emissions, cost efficiency, noise
reduction, improved ergonomics and safety for drivers, integrated design, and operational cost
efficiency. For example, the vehicle has been certified by the California Air Resources Board as
a zero-emission truck, assisting garbage collection firms to comply with environmental
legislation and meet sustainable goals. As an electric car, the McNeilus® Volterra™ has
significantly reduced noise and operational costs in terms of maintenance and fuel savings than
traditional combustion engine trucks. The radar technology, 360-degree camera, all-in-one
integrated design, and the 38% larger cockpit size account for improved safety and ergonomics
for drivers (Oshkosh Corporation, 2023).
2.1.3 Market trends
Like in any other industry, market trends will likely play a critical role in how garbage
collection companies perceive the McNeilus® Volterra™ ZSL™ truck. The first pattern is the
shift toward stringent regulation to ensure environmental sustainability, a long-term trend pushed
by a growing sensitivity to environmental destruction and climate change. Across the globe,
governments are rushing to enforce stricter carbon footprint laws and policies, piling more
pressure on companies to lower their emissions. The United States Clean Air Act (CAA) is a
classic example of these stringent regulations that will likely spike the attractiveness and demand
for the McNeilus® Volterra™ ZSL™. The Clean Air Act authorizes the EPA to create air quality
standards and protocols to safeguard the environment and public health (Bureau of Ocean Energy
Management, n.d.). All companies, including garbage collection firms, must comply with these
requirements. Passing and enforcing more of these rigorous laws will make electric trucks, such
as the McNeilus® Volterra™ ZSL™, more attractive to customers.

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The second pattern that can push up the demand for and sales of electric garbage
collection trucks is the transition toward electrification of commercial fleets. Today, most
companies are electrifying their fleets, if not made pledges, to attain carbon neutrality before

2050. For example, the giant e-commerce firm, Amazon, added 50 electric trucks from Tesla to
      its crew and committed to purchase over 100,000 electric delivery vans from Vivian (Hawkins,
      2024). With industrial and commercial sectors embracing electric-powered engines as the
      preferred means of transportation, McNeilus’s appeal to consumers is potentially going to
      increase. Waste management firms will feel the pressure to electricity their fleet if companies
      across other industries make the sweeping change. The smart city initiative is the third most
      impactful trend that can boost McNeilus’s attractiveness to customers. In recent years, there has
      been an emerging pattern of “smart cities/metropolises” that leverage technology and innovative
      solutions to enhance resource efficiency, increase people’s quality of life, and bolster urban
      services. The McNeilus® Volterra™ ZSL™ perfectly fits into this new “smart city” push, as it is
      quieter with a zero carbon footprint.
      2.1.4 Market growth
      The market for clean energy, electric-powered trucks, including niche garbage collection
      vehicles, is growing exponentially. According to Fortune Business Insights (2024), the
      international market for electric trucks was worth approximately $815.3 million in 2023 and is
      predicted to surge to $1.09 billion in 2024 and $13.04 billion in 2032. This represents a
      significant growth of nearly 36.4% in 8 years, between 2024 and 2032. This remarkable growth
      will be driven by the recent investment in electric trucks by leading automobile manufacturers
      (Oshkosh Corporation, Daimler, Vera, Volvo, Rivian, BYD, Ford, Mercedes, and Tesla) and the
      entry of new players (TuSimple, Einride, and Embark).

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For Oshkosh Corporation, taking advantage of the expected growth is the most prudent
and strategic decision. This can be done by penetrating the market early and positioning the
McNeilus® truck as the pioneer and model in the electric garbage pickup segment. The company
must also consider partnering with waste management firms and municipalities to pilot the
McNeilus®, a move that can provide critical real-work insights. This data can be used to remodel
and improve the truck. Potential considerations for the company may also include educational
and awareness campaigns with potential customers, offering customization alternatives to meet
unique consumer needs, building comprehensive after-sale services and networks, providing
leasing and flexible financial alternatives, and continuously investing in research & development
to maintain a competitive edge.
2.2 SWOT Analysis
2.2.1 Strengths
The first selling point for Oshkosh Corporation is that the McNeilus® Volterra™ ZSL™
garbage truck is an innovation marvel, boasting cutting-edge integrated design and advanced
features, such as radar technology, 360-degree camera view, increased cabin size, and a powerful
battery capacity capable of covering a full-day route on a single charge. The second competitive
strength stems from Oshkosh’s strong brand reputation in manufacturing specialty vehicles and
machines. The company has been in operation since 1917, designing and selling access
equipment, airport fire apparatus, truck bodies, military vehicles, and specialty trucks. Oshkosh’s
third competitive edge is the certification of the McNeilus® Volterra™ ZSL™ as a zero-
emissions vehicle by the California Air Resources Board. Certification means increased
customer and public trust and confidence in the brand’s quality, safety, and capability.
2.2.2 Weaknesses

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One potential setback for the company is the likely higher upfront cost of manufacturing
the McNeilus® Volterra™ ZSL™. The company has invested billions in researching and
designing the McNeilus, a major concern for industry experts as to whether the venture will be
profitable in the long term. More money is expected to be pumped into building a larger plant as
the company ramps up production in the future. This astronomical upfront investment has forced
the company to sell the McNeilus® truck at a premium price (an estimated $120,000), creating
another major competitive disadvantage (California HVIP, n.d.). Admittedly, a $120,000 price
tag is nearly double the market range for traditional combustion engine garbage trucks. This
might be a problem for Oshkosh considering most municipalities are operating on tight budgets.
The third potential issue for the new McNeilus Volterra truck is related to growing concerns
about the battery and the cost of replacing it.
2.2.3 Opportunities
One opportunity the company can leverage is the expected 36.4% market growth in the
electric truck business within the next decade (Fortune Business Insights, 2024). The company
can position itself as a trailblazer in the garbage collection electric truck segment by investing in
R&D, pilot-testing the new trucks, and intensively marketing the new product. The increased
push by governments globally for firms to switch to clean energy and sustainable mobility
through the enactment of stringent legislation is another aspect that can drive the attractiveness
of the McNeilus Volterra to customers. Other opportunities the company can benefit from to
scale up production include potential government incentives, rising fuel costs, a growing need
for sustainable and cost-effective waste management practices, and smart city initiatives.
2.2.4 Threats

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One potential threat for Oshkosh is increased competition from other manufacturers.
Despite being in the market for over a decade, Oshkosh’s minuscule market share of the global
waste management/garbage collection truck sector is a huge concern. Economic downturns are
other risks that might adversely impact the company’s sales, revenue, and growth. Budget cuts
for municipalities due to the financial crisis might translate to reduced McNeilus purchases.
Thirdly, rapid technological advancement might present a potential threat to the McNeilus
market position, disrupting production and sales. Other threats include fluctuations in the cost of
materials (especially lithium-ion batteries), regulatory changes, and resistance to change from
waste management firms and municipalities.
2.3. Competition
By far, Oshkosh’s McNeilus controls a minuscule share in a global market dominated by
products from giant companies. Leading players by market share include Scranton
Manufacturing, Foton Car, Heil, Dongfeng Motor, Ceec Trucks Industry, Curbtender, Cheng Li,
and Cnhtc (Xenon Market Insights, 2024). Leading car brands (Renault, Daimler, Vera, Volvo,
Rivian, BYD, Ford, Mercedes, and Tesla and startups (TuSimple, Einride, and Embark) are also
expected to make inroads following significant investments in the sector recently.
Despite stiff competition, customers might choose the McNeilus Volterra ZSL over
competitors because of the integrated body-chassis design, advanced comfort and safety features,
the ability to cover the entire route on a single charge, and Oshkosh’s unbeatable reputation.
However, Oshkosh can do the following to compete to win: invest in R&D to improve safety and
quality features, embark on an aggressive marketing strategy that combines traditional and
digital approaches, introduce leasing options, and provide competitive prices in the long run.

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McNeilus® Volterra™ ZSL™ faces strong competition from BYD’s 8R Battery Electric
Truck. BYD is a Chinese-based company that specializes in electric cars and has recently
diversified to specialty trucks and other innovative products. The 8R is the company’s flagship
product in the electric refuse truck sector. Its core features include 25 cubic yards of compactor
body, an integrated body-chassis system, coverage of 200 miles per charge, state-of-the-art
motors, controls, and 280+ KWh lithium iron phosphate batteries (BYD, n.d.). The 8R model
prices ranged between $85,000 and $120,000. In terms of place, the BYD 8R trucks are available
across major global marketplaces, including the US, Asia, Europe, and North America. BYD
promotes the 8R electric truck as having zero emissions, an integrated system, and advanced
lithium iron phosphate batteries.
2.4 Product Offering
The state-of-the-art design features of the McNeilus® Volterra™ ZSL™ include a full-
electric car (zero emissions), integrated body chassis, advanced lithium-ion batteries, high-tech
driver assistance systems (radar system and 360-degree camera) for advanced visibility and
comfort, 8% larger cockpit size, and cost efficiency. The truck has been certified by the
California Air Resources Board as a zero-emission truck, assisting garbage collection firms to
comply with environmental legislation and meet sustainable goals (Oshkosh Corporation, 2023).
2.5 Key to Success
With competition mounting from other larger firms like BYD and startups, the secret to
McNeilus Volterra’s success lies in technology leadership, leveraging existing robust
relationships with customers and partners, an aggressive marketing strategy, and effective
support and education. Oshkosh must continue investing in R&D, whether in terms of lithium-
ion batteries or safety and comfort features, to remain at the top.

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2.6 Critical Issues
Oshkosh can leverage its strengths and opportunities in multiple ways. Firstly, the
company can use its long-standing brand reputation to build confidence and trust in the
McNeilus Volterra. It can also take advantage of the growing consumer demand for
environmentally friendly solutions to ramp up production and diversify into other electric vehicle
niches. At the same time; it can lessen the impacts of threats and weaknesses by sourcing for
external financiers to offset the lofty upfront expenses, pumping money into R&D to outpace
competitors, and building partnerships with battery manufacturers to improve its lithium-ion
battery packs. Finally, the McNeilus is presently at the “Introduction Phase” of the product
development life cycle. This phase is typified by low sales, high manufacturing costs, limited
rivalry, and a need for awareness training for consumers.

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References

Bureau of Ocean Energy Management. (n.d.). Air Quality Act (1967) or The Clear Air Act
(CAA). https://www.boem.gov/air-quality-act-1967-or-clean-air-act-caa#
BYD. (n.d.). Model: BYD 8R refuse truck. en.byd.com/truck/class-8-refuse-truck/
California HVIP. (n.d.). Oshkosh RCV battery electric vehicle; McNeilus RCV, Volterra ZSL.
https://californiahvip.org/vehicles/oshkosh-rcv-zsl-mcneilus/
Fortune Business Insights. (2024). Electric truck market size, share & industry analysis, by
propulsion (BEV, PHEV, and FCEV), by vehicle type (light duty trucks, medium duty
trucks, and heavy-duty trucks), by range (150 miles, 151-300 miles, and above 300
miles), and regional forecasts, 2024-2032. fortunebusinessinsights.com/electric-trucks-
market-102512
Hawkins, A. J. (2024, May 7). Amazon adds 50 electric trucks to its delivery fleet in a bid to
reduce pollution. The Verge. https://www.theverge.com/2024/5/7/24151187/amazon-
electric-truck-volvo-first-middle-last-mile
Manthey, N. (2023, February 21). Oshkosh is developing all-electric waste trucks. Elective.
https://www.electrive.com/2023/02/21/oshkosh-is-developing-all-electric-waste-trucks/
Oshkosh Corporation. (2023, September 26). McNeilus announces first order of fully
integrated electric RCVs with republic services.
https://www.oshkoshcorp.com/news/2023/9-26-23-mcneilus-volterra-zsl-first-order
Oshkosh Corporation. (2023, September 26). McNeilus announces first order of fully integrated electric
RCVs with republic services. https://www.oshkoshcorp.com/news/2023/9-26-23-mcneilus-
volterra-zsl-first-order

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Xenon Market Insights. (2024). Garbage collection trucks market share growth: Analyzing
strategies of top players by 2032. https://www.linkedin.com/pulse/garbage-collection-
trucks-market-share-growth-analyzing-qswlc