Class 8 Truck Fleet Grew in 4Q Following 1st Decline, Polk Says

This story appears in the March 2 print edition of Transport Topics.

The number of Class 8 trucks operating in the United States increased by 60,000 at the end of the fourth quarter from a year earlier, reversing the first-ever decline of 17,000 that research firm R.L. Polk & Co. reported at the end of the third quarter.

Gary Meteer, director of Polk’s Commercial Vehicle Group, said he believes the increase reflects “anticipation” of business from economic stimulus legislation.

However, a separate study that looks more narrowly at construction and freight-hauling fleets said the number of Class 8 trucks in “active service” at the end of 2008 declined.

The broader Polk survey of vehicle registrations includes large buses and recreational vehicles as well as highway tractors and vocational trucks.

Polk’s Feb. 13 report said U.S. fleets operated approximately 3.65 million heavy-duty vehicles at the end of December, up 1.7% from 3.59 million in December 2007 and an increase of about 80,000 from the number on the road at the end of the third quarter, when Polk estimated the Class 8 fleet has slipped 0.4% from the same period in 2007 (click here for previous Premium Content story).

Explaining the increase, Meteer said, “The stimulus is a positive for construction and a positive for Class 8 trucks. All of the products [used to repair infrastructure] move by truck.”

The fourth-quarter increase could also indicate that fleets are keeping more equipment on the road, as fuel prices have eased and fewer motor carriers have gone out of business, Meteer said.

A separate estimate of Class 8 trucks from MacKay & Co. showed 2.69 million Class 8 trucks in use at the end of 2008, a 2.2% decline from 2.75 million in 2007, said Dave Fulghum, vice president. Fulghum presented the estimate Feb. 17 at the Heavy Duty Manufacturers Association meeting in Orlando, Fla.

“The population of Class 8 trucks has not grown much in the last two or three years,” Fulghum said in an interview with Transport Topics. “There is no growth in freight, so people are not buying trucks.”

MacKay’s estimate is derived from an analysis of new truck sales and the number of vehicles scrapped or exported, based on fleet surveys rather than registrations. The data include trucks used by freight haulers and vocational fleets but specifically excludes fire trucks, motor homes and transit buses.

Fulghum said he didn’t expect to see an increase in the Class 8 truck fleet size until late 2010 or 2011 but that it could grow significantly after that because of pent-up demand.

“By 2013, we could add 400,000 to 500,000 Class 8 trucks to the U.S. market,” he said.

Much will depend on whether the economy can reverse its current downward spiral. “If we go back 10 years and reset the economy, all bets are off,” Fulghum said.

Polk’s data show 135,700 new Class 8 vehicles were registered in 2008, down 20.6% from 171,000 vehicles in 2007 and the lowest since 125,100 units were registered in 1992.

Total vehicle registrations for all classes of commercial vehicles dropped 25% to 485,000 units in 2008 from 647,000 units in 2007.

The biggest percentage decline in new registrations was in Class 6 vehicles, which fell 35.7% to 45,000 units in 2008 from 70,000 units in 2007.

Class 6 vehicles are primarily used for daily rental and leasing.

“With the decline in housing starts and the general economic climate, this vehicle segment has been hit extremely hard,” Meteer said.

Government also increased its share of Class 5 vehicle registrations.

“The government has never been a large purchaser of new vehicles in Class 5,” Meteer said. “However, government registrations accounted for 10% of total Class 5 new registrations during the 2008 calendar year.”

The largest vehicle categories — Class 3 and Class 8 — also had the deepest decline in registrations. There were 55,000 fewer Class 3 vehicles registered in 2008 compared to the prior year and 35,000 fewer Class 8 units registered.

Both large and small fleets cut back on new truck registrations with the largest decline by fleets with one to five units, the Polk data showed.

“This is a complete reversal from the experience during the 2007 calendar year, when these smaller fleets accounted for over 52% of all new registrations,” Meteer said.