Class 8 Truck Demand Hits 4-Year Low

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Heavy Duty Trucking  /  July 6, 2016

Class 8 truck order numbers have hit a 4-year low, with demand remaining depressed so far in 2016 according to industry analysts.

“The Class 8 market is stuck in a holding pattern, at the bottom end of this cycle.  Fleets are cautious as freight demand has cooled off this year,” said Don Ake, vice president of commercial vehicles at FTR. “There are enough trucks to handle freight right now with carriers in a wait-and-see mode, before adding trucks or replacing older units.”

FTR projects Class 8 truck orders for the month of 13,000 units. That represents an 8% drop compared to May and a 34% decline compared to last June.

This month’s order activity was the lowest monthly total since July 2012 and the worst June since 2009.

“This is what the summer looks like in a market down cycle, so we can expect this level of activity for a couple more months,” said Ake. “We do anticipate higher orders later this year.  However, the volume of orders will be determined by the strength of the economy and freight activity at that time.”

Class 5-7 medium-duty vehicle orders also fell in June and are projected to hit 15,200 orders for the month. Unlike Class 8, which has struggled to get going in 2016, the drop in medium-duty orders was attributed to the strength of the market in previous months.

The pull-back of the past two months follows a three-month stretch from February to April in which medium duty orders were booked at a volume well ahead of demand.

 

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Class 8 Orders Fall to Nearly Six-Year Low

Transport Topics  /  July 6, 2016

North American orders for Class 8 trucks in June fell to the lowest point in nearly six years, market analysts report.

The 13,100 total — a preliminary tally, which will be revised later this month — was the lowest since the third quarter of 2010 and down 35% compared with 20,287 a year earlier.

Class 8 vehicle orders continued to lose traction in June.

Last month, Volvo Trucks North America (VTNA) announced production cuts at its Dublin, Virginia, plant in “the early August timeframe,” given the continued decline in Class 8 orders.

Daimler Trucks North America (DTNA) also said in June that it plans to cut 1,240 jobs across most of its North American production facilities starting in late June as it anticipates a 15% decrease in Classes 6-8 retail sales from 425,000 units in 2015.

Together, the two [foreign] truck manufacturers control about 60% of the [North American] market.

At the same time, June orders also fell 8% from the May total of 14,224.

Conditions in the Class 8 market have been slower to improve than expected at the beginning of the year. The volume reflects continued pressures in the freight market, confirmed by several recent negative pre-announcements of earnings and elevated production rates, which have made inventory destocking difficult.

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Heavy, medium truck orders slide to four-year low

Commercial Carrier Journal (CCJ)  /  July 6, 2016

Class 8 truck orders dropped to 13,100 units last month, while Class 5-7 orders totaled just 15,200 units.

The last time heavy truck order levels hit marks this low, the country was shedding the effects of an economic recession.

The pace of commercial vehicle orders slowed in seasonal fashion into the first month of summer say analysts. June’s medium- and heavy-duty net order total volume was the lowest monthly order total since July 2012. Seasonally adjusted, at 31,500 units, it was the lowest total since September 2012.

FTR’s preliminary Class 8 net orders for June – the worst June since 2009 – show intake 8 percent below May and down 34 percent year-over-year. The annualized rate of orders continues to drop – 162,000 now for past three months, 185,000 for the past six months and 224,000 over the past 12 months.

“The Class 8 market is stuck in a holding pattern, at the bottom end of this cycle,” says Don Ake, FTR’s vice president of commercial vehicles. “Fleets are cautious as freight demand has cooled off this year. There are enough trucks to handle freight right now with carriers are in a wait-and-see mode, before adding trucks or replacing older units.”

Ake anticipates higher orders later this year, however, the volume of orders will likely be determined by the strength of the economy and freight activity at that time.

“This is what the summer looks like in a market down cycle, so we can expect this level of activity for a couple more months,” he says.

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