According to ACT Research’s (ACT) latest State of the Industry: Classes 5-8 Report, the “less negative” freight data reported early in Q3 has softened further since the September 1st tariff impositions.
ACT’s State of the Industry: Classes 5-8 report provides a monthly look at the current production, sales, and general state of the on-road heavy and medium duty commercial vehicle markets in North America. It differentiates market indicators by Class 5, Classes 6-7 chassis and Class 8 trucks and tractors, detailing measures such as backlog, build, inventory, new orders, cancellations, net orders, and retail sales. Additionally, Class 5 and Classes 6-7 are segmented by trucks, buses, RVs, and step van configurations, while Class 8 is segmented by trucks and tractors with and without sleeper cabs. This report includes a six-month industry build plan, backlog timing analysis, historical data from 1996 to the present in spreadsheet format, and a ready-to-use graph package. A first-look at preliminary net orders is also published in conjunction with this report.
“September NA Class 8 retail sales reached a new record in seasonally adjusted terms, and in absolute terms were the highest since December 2006, ahead of the EPA07 emissions standards. While most of the incremental strength came from the straight truck market, tractor capacity was added a touch faster than expected,” said Tim Denoyer, ACT Research’s Vice President and Senior Analyst. He explained, “We realize this seems to conflict with signs of capacity contraction such as bankruptcy and employment data, and would remind readers that private fleets, which now account for more than half of truckload capacity, are still growing.”
Speaking about the Class 8 market, Denoyer said, “In concert with weak/deteriorating freight volumes and rates, forward-looking demand indicators continue to erode, with mid and downstream data points beginning to cycle lower. Ultimately, the current situation of weak orders and strong build is unsustainable, and downward build plan revisions are happening. That said, the worst case scenarios for heavy vehicle demand remain unlikely.”
Regarding the medium duty markets, he commented, “Medium duty demand metrics remain in better balance, but there are signs of fraying on weak net orders, relative build strength and excessive inventories.”
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 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.
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