ACT Research: Mild Recession Now Base Case in Forecasting of NA CV Markets

According to ACT’s latest release of the North American Commercial Vehicle OUTLOOK, ACT lowered their GDP forecast, but continues to believe there is enough pent-up demand, and built-up purchasing power among consumers, albeit mitigated by inflation, to support growth in 2022. ACT’s analysts also believe tighter monetary policy will lead to GDP contraction in the first half of 2023, which will be offset by growth in the second half of next year, leading to a flat GDP forecast for the full year.

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.

ACT Research: Mild Recession Now Base Case in Forecasting of NA CV MarketsAccording to Kenny Vieth, ACT’s President and Senior Analyst, “We note that the modest economic rebound we are forecasting in the latter half of 2023 implies a pause in tightening by the Fed by the first half of the year.” He continued, “As the economy laps tough inflation comparisons in early 2023, and with the economy sufficiently slowed by 2022’s justifiably aggressive rate hikes, we believe inflation is likely to come increasingly under control, allowing the Fed to pause and take stock. With no additional pressure being applied to the brakes, we envision the economy to resume expanding in the end of 2023.”

Vieth concluded by discussing the potential impact to commercial vehicle markets, “We continue to see at least three factors mitigating a more severe downturn.” Vieth noted, “Carrier profitability is strong, with profits at all-time record levels in 2021, and full-year TL fleet profits are pegged at second-best ever levels in 2022. Vehicle demand remains healthy, if moderating from here, with pent-up demand expected to push into 2023. Finally, some prebuy activity is anticipated prior to the implementation of CARB’s Clean Truck mandate, helping to support activity next year.”

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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