In the release of its Commercial Vehicle Dealer Digest, ACT Research noted that the heavy truck and trailer markets, and increasingly the medium duty market, are heading for corrections in 2020, even as the slow growth US economic outlook remains largely unchanged, aside from concerns about trade and tariffs. The key driver of the near to mid-term outlook is the US consumer, who remains well positioned to keep the economy out of the ditch, even as key freight-generating sectors of the economy take a pause.
“Current Class 8 production strength continues to cause an upward drift in 2019 expectations that is nibbling away at 2020 potential, as this year’s additional inventory accumulation will ultimately be paid back in future production levels,” said Kenny Vieth, ACT’s President and Senior Analyst. He continued, “The forecast scenario that we have been calling for appears to be playing out on schedule in the second half of this year, and if build rates are maintained longer than expected, there might still be some upside in the 2019 production forecast.”
Vieth added, “However, large new inventories and deteriorating freight and rate conditions suggest erring on the side of caution remains the right call. When the change comes, it is likely to come fast, and we are encouraging our subscribers to be prepared for down weeks starting as early as Q4.”
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. Executive staff appointments include a seat on the Board of Directors of the National Association for Business Economics and Consulting Economist to the National Private Truck Council. Accolades include 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.