ACT Research: Heavy Duty Market Anticipating Accelerating Pullback in Build Rates

According to ACT’s latest release of the North American Commercial Vehicle OUTLOOK, expectations for the Class 8 and trailer markets anticipate an accelerating pullback in build rates, as freight market conditions remain at a low ebb. While less cliff-like, medium duty market indicators continue to support a modest correction into 2020.

The N.A. CV OUTLOOK is a robust report that forecasts the future of the industry, looking at the next 1-5 years, with the objective of giving OEMs, Tier 1 and Tier 2 suppliers, and investment firms the information needed to plan accordingly for what is to come. The report provides a complete overview of the North American markets, as well as takes a deep dive into relevant, current market activity to highlight orders, production, and backlogs, shedding light on the forecast. Information included in this report covers forecasts and current market conditions for medium and heavy duty trucks/tractors, and trailers, the macroeconomies of the US, Canada, and Mexico, publicly-traded carrier information, oil and fuel price impacts, freight and intermodal considerations, and regulatory environment impacts.

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“They say a picture is worth 1,000 words, and one of our favorites is an overlay of the 12-month moving average of Class 8 net orders and actual production data,” said Steve Tam, ACT’s Vice President. He elaborated, “As 20 years of history show, where the order trend goes, build follows, and positively, a turn in the 12-month moving order average can be seen as starting in December, meaning Class 8 orders in 2020 should handily outperform 2019.” Tam added, “On the downside, we would note that every trough in the order average in the past 20 years has been met with a corresponding drop in builds.”

Regarding heavy vehicle demand, he noted, “Despite a high-side production surprise in September, large new inventories and deteriorating freight and rate conditions keep us cautious into the end of 2019.”

OUTLOOK PR Graph 11-12-19Regarding ACT’s medium duty forecasts, Tam said, “Preliminary October net orders for this market segment slowed to their lowest level since July of 2016, and the drop appears to be a signal that medium duty vehicle buyers are stepping back from the torrid pace of demand the space has enjoyed over the past year and a half.”

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

ACT’s 62nd seminar is scheduled for February 11-13, 2020, and will feature trucker, electrification, and economic panels, as well as discussions on near-term demand of North American commercial vehicle markets and the pending impact of electrification on the market in the near future. A commercial vehicle database workshop is also being planned in conjunction with this semi-annual event.

OUTLOOK 11.13.19

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