ACT Research: Mild Recession Scenario Being Considered in Forecasting of NA CV Markets

According to ACT’s latest release of the North American Commercial Vehicle OUTLOOK, while ACT Research still believes a soft landing is the US economy’s most likely path, the potential for a mild recession is becoming an increasingly compelling alternative.

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.

“We find ourselves in a turbulent environment, where still significant positive and increasingly negative economic forces are crashing into one another." - Kenny ViethAccording to Kenny Vieth, ACT’s President and Senior Analyst, “We find ourselves in a turbulent environment, where still significant positive and increasingly negative economic forces are crashing into one another. With inflationary shocks emanating from Ukraine, the Fed’s task of engineering a soft landing has become increasingly challenging.” He continued, “We believe downward pressures are building, and the probability of recession continues to grow. We think the probability of a mild recession is now nearly as likely as that of our base-case scenario.”

Vieth concluded, “With the current head of steam that includes healthy consumer and business balance sheets, strong employment demand, and pent-up manufacturing sector activity, this inflation driven economic slowdown is on one hand somewhat unique. On the other, traditional recession predictors are in play: Fed rate hikes, high energy prices, negative exogenous events and falling equity valuations come to mind.” Vieth noted, “We believe the odds of a recession materializing, in some form or fashion, are essentially 50/50 relative to our slowing topline growth into a modest freight recession base case.”

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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