ACT Research has published a North American commercial vehicle and transportation prebuy analysis, Bigger Than Ever?: The Higher the Cost, The Bigger the Prebuy, which analyzes the new US Environmental Protection Agency (EPA) Notice of Proposed Rulemaking (NPRM) for Heavy-Duty Engine and Vehicle Standards and its likely impact on the US truck manufacturing and freight transportation industries. Key findings indicate the new standards will likely result in the largest prebuy ever.
ACT’s NA Commercial Vehicle & Transportation Prebuy Analysis, Bigger Than Ever?: The Higher the Cost, The Bigger the Prebuy, builds upon a number of earlier studies of commercial vehicle prebuying behavior, and presents and compares three scenarios based on different potential costs. This robust, 32-page analysis covers these three model outputs and analysis of prebuys due to the proposed regulations; the labor and emissions impact; prebuy/lowbuy model methodology, including tractor prebuy estimates, HHD tractor cost analysis, lowbuy effects, trucking industry sizing and freight rate impact, vocational prebuy model outputs, and MHD prebuy model outputs. Supporting analysis includes dealer prebuying, ability to buy considerations, secondary market effects, and a history on the hidden prebuy of 2002; estimation using regression analysis; and the uncertainties and future implications. ACT, just like those who manufacture and operate commercial vehicles, are pro clean air. This analysis examines the market shifting consequences of the very expensive solutions needed to tackle a very important problem.
According to Tim Denoyer, Vice President & Senior Analyst at ACT Research, “The coming prebuys will have large effects on commercial vehicle volumes and industry employment, which will have to be ramped to fulfill demand, only to be followed by significant job cuts and industry financial performance. Prebuying adds surplus capacity, which will weigh on freight rates in 2026 and 2027, perhaps materially impacting the trucking industry’s financial performance for a couple of years. From a long-term perspective, the cost of equipment is a rising barrier to entry that should support industry health and development of clean technologies.”
Denoyer continued, “The significant costs analyzed in this report are needed as the commercial transportation industry takes more responsibility for its role in climate change, and this analysis examines the market consequences of the new rules, filling in some key blanks left in EPA analysis.”
In describing ACT’s prebuy modeling methodology, Kenny Vieth, President & Senior Analyst at ACT Research, says it’s straightforward: “How much is it going to cost to operate? Are those costs mitigated by improved operating characteristics? And, does the trucking industry have the wherewithal to do something about it? If the answer to the first question is “biggest ever” and the answer to the second is “no mitigation,” the conditions are in place to warrant a major prebuy.” He adds, “The final resolution of prebuy size will be determined by where the economy is in 2025-2026, and based on our analysis, the ability of commercial vehicle supply chains to meet what we foresee as record demand ahead of the prebuy.”
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 67th Seminar is scheduled for August 23-25, 2022. The focus will be the potential impact of decarbonization and autonomous technology on commercial vehicles and on-highway transportation. Each event ACT shares its best-in-class data and forecast in presentations, as well as featuring guest speakers to dive into topics of interest for the benefit of attendees. The agenda includes key industry leaders, who will be announced at a later date. For more information about Seminar 67 Watts Under The Hood: Transportation Transformation, click here: https://www.actresearch.net/seminar-67/.
ACT Research recently completed POWER UP, a look at 7 global regions and more than 20 countries in a review of local regulations, infrastructure, and the impact on the adoption of battery and fuel cell electric commercial vehicles through 2040. This forecast is the first of its kind, a review of the decarbonization of commercial vehicles around the world. POWER UP is available now at https://www.actresearch.net/power-up/.
Additionally, ACT Research published an update to CHARGING FORWARD, a North American-centric battery and fuel cell electric vehicle adoption rate forecast, covering 23 vehicle applications, in Classes 4-8 commercial vehicles, through 2040. CHARGING FORWARD is considered by many industry leaders to be the apex of analysis and economic-based total cost of ownership modeling in the industry. And, it is now available for purchase at https://www.actresearch.net/electric-vehicles-charge/.
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