According to ACT Research’s (ACT) latest State of the Industry: NA Classes 5-8 report, current economic conditions are proving resilient in the face of aggressive interest rate hikes. Heavy duty and medium duty net orders both took giant steps up from August levels in September, both on a nominal as well as seasonally adjusted basis.
ACT’s State of the Industry: NA Classes 5-8 report provides a monthly look at the current production, sales, and general state of the on-road heavy and medium duty commercial vehicle markets in North America. It differentiates market indicators by Class 5, Classes 6-7 chassis and Class 8 trucks and tractors, detailing measures such as backlog, build, inventory, new orders, cancellations, net orders, and retail sales. Additionally, Class 5 and Classes 6-7 are segmented by trucks, buses, RVs, and step van configurations, while Class 8 is segmented by trucks and tractors with and without sleeper cabs. This report includes a six-month industry build plan, backlog timing analysis, historical data from 1996 to the present in spreadsheet format, and a ready-to-use graph package. A first-look at preliminary net orders is also published in conjunction with this report.
According to Eric Crawford, ACT Research’s Vice President, Senior Analyst, “For now, business activity is winning the tug of war with higher interest rates. That said, we expect this dynamic to shift in 1H’23, as the Fed continues its aggressive push to subdue inflation.”
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About September, Crawford noted the record-setting Class 8 order activity. He explained, “production levels were ahead of OEM build plans for both heavy-duty (HD) and medium-duty (MD) by a considerable margin. Otherwise, activity was largely in line with expectations: 1) more Class 8 OEMs began opening 2023 orderboards, and 2) HD and MD cancellation volumes and rates remain low, albeit up from prior month for Class 8 following the record low set in August.” He concluded, “While underlying economic activity remains elevated, the record-breaking orders were also a function of customers’ inability to secure as much equipment in 2021 and 2022 as they’d preferred, creating pent-up demand for 2023, as well as a burst of activity when 2023 orderboards were opened more broadly. In other words, had supply chain and labor issues not dampened 2022 build rates, or had 2023 build slots already been widely available for orders to be placed, we think orders would have been strong, but not record-breaking strong.”
ACT Research is recognized as the leading publisher of commercial vehicle truck, trailer, and bus industry data, market analysis and forecasts for the North America and China markets. ACT’s analytical services are used by all major North American truck and trailer manufacturers and their suppliers, as well as banking and investment companies. ACT Research is a contributor to the Blue Chip Economic Indicators and a member of the Wall Street Journal Economic Forecast Panel. ACT Research executives have received peer recognition, including election to the Board of Directors of the National Association for Business Economics, appointment as Consulting Economist to the National Private Truck Council, and the Lawrence R. Klein Award for Blue Chip Economic Indicators’ Most Accurate Economic Forecast over a four-year period. ACT Research senior staff members have earned accolades including Chicago Federal Reserve Automotive Outlook Symposium Best Overall Forecast, Wall Street Journal Top Economic Outlook, and USA Today Top 10 Economic Forecasters. More information can be found at www.actresearch.net.
ACT’s 68th Seminar is scheduled for February 21-23, 2023. Look for more details on this event over the coming months and save the date for February’s event. When details are available, they may be found at www.actresearch.net.
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