Mack deliveries decline 11% in November

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The Morning Call / December 17, 2015

Production slowed in November for Mack Trucks, with the heavy-duty truck manufacturer reporting its first delivery decline of the year.

Mack delivered 2,171 rigs worldwide in November, an 11 percent decrease from the 2,451 it sent out one year earlier, according to a report released Thursday by the Sweden-based Volvo Group, Mack's parent company. Volvo also reported an 11 percent decline in deliveries of its heavy-duty trucks.

Of Mack's worldwide total, 2,021 — about 93 percent — were delivered in North America, down 6 percent compared with a year ago. Mack also saw a decline in South America, delivering 75 trucks there in November, falling short of the 209 sent there in November 2014.

While it's the first reported delivery decline for Mack this year, the figures are not entirely unexpected.

Wade Watson, vice president and general manager of Mack Trucks Lehigh Valley Operations, said the decline in production was partly caused by holidays in November, calling last month's figures "basically an impact of the season."

However, Watson said, Mack still has a "fair amount of backlog" it is getting through, causing employees to work some extra days earlier this month. "December looks like it's going to be a pretty strong month for us on deliveries," Watson said.

Mack also is adjusting its workforce amid an anticipated 10 percent decline in the heavy-duty truck market next year. The company said Tuesday it will lay off about 400 workers in the Lehigh Valley by late January.

Mack currently employs 1,850 at its Lehigh Valley Operations and its 1-million-square-foot Lower Macungie Township plant is where all Mack trucks built for the North American market and export are assembled.

The heavy-duty truck market is expected to peak this year and, at least at one point this year, Mack's Lower Macungie plant had been pumping out 116 trucks a day.

Through November, Mack delivered 25,198 trucks, up 8 percent from the 23,349 from the same 11-month stretch last year.

In its third-quarter report, Volvo said it expects the total North American retail market for heavy-duty trucks to approach 310,000 trucks in 2015.

In 2016, the company expects solid — but lower — demand of about 280,000 trucks. Other firms, such as Stifel Financial Corp., have lower projections. In a Dec. 7 report, Stifel decreased its 2016 North American heavy-duty truck production estimate from 280,000 units to 250,000 after order data underwhelmed for the second consecutive month in November.

Watson said he sees next year's expected decline as a market correction, after heavy-duty truck makers received an influx of orders at the end of 2014 and built at high levels this year. He also said the workers who will be affected by the upcoming layoff — they have recall rights with the exception of probationary employees — could eventually be brought back.

"I expect to see the market come back," Watson said. "It's a cyclical business. We see ebb and flow over usually a three-year period."

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[kscarbel2]

Mack Deliveries Decline in November

Transport Topics / December 17, 2015

Production slowed in November for Mack Trucks, with the heavy-duty truck manufacturer reporting its first delivery decline of the year.

Mack delivered 2,171 rigs worldwide in November, an 11% decrease from the 2,451 it sent out one year earlier, according to a report released Dec. 17 by the Sweden-based Volvo Group, Mack's parent company.

Of that, 2,021 — or about 93% of the worldwide total — were delivered in North America, down 6% compared with a year ago. Mack also saw a decline in South America, delivering 75 trucks there in November, falling short of the 209 sent there in November 2014.

While it's the first reported delivery decline for Mack this year, the figures are not entirely unexpected.

Mack said Dec. 15 it will lay off about 400 workers in the Lehigh Valley by late January, allowing the manufacturer to adjust to an expected 10% decline in the heavy-duty truck market next year. Mack employs 1,850 in the Lehigh Valley and its 1 million-square-foot Lower Macungie Township plant is where all Mack trucks built for the North American market and export are assembled.

The heavy-duty truck market is expected to peak this year and, at least at one point this year, Mack's Lower Macungie plant had been pumping out 116 trucks a day.

Through November, Mack delivered 25,198 trucks, up 8% from the 23,349 from the same 11-month stretch last year.

In its third-quarter report, Volvo said it expects the total North American retail market for heavy-duty trucks to approach 310,000 trucks in 2015.

In 2016, the company expects solid — but lower — demand of about 280,000 trucks. Other firms, such as Stifel Financial Corp., have lower projections. In a Dec. 7 report, Stifel decreased its 2016 North American heavy-duty truck production estimate from 280,000 units to 250,000 after order data underwhelmed for the second consecutive month in November.

Mack was not the only manufacturer to see a decrease in deliveries in November. According to the report, Volvo delivered 9,360 of its heavy-duty trucks in November, also down 11% from one year earlier when it sent out 10,574 vehicles.