Class 8 Truck Orders Increased 50% Year-Over-Year During May
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North American Class 8 truck orders continued the trend of year-over-year gains in May, according to ACT Research.
ACT preliminary data showed orders increased 49.7% to 23,200 units from 15,500 during the same period in 2023. They also increased 48.7% sequentially from the 15,600 units reported the previous month. Every month this year has seen a year-over-year increase except March.
“Market observers may recall that demand typically slows in Q2,” ACT Research Vice President Steve Tam said. “However, surprises are always lurking. Class 8 preliminary order intake provided May’s drama, effectively zigging when they were expected to zag.”
Tam added that order activity was impacted amid ample open build slots in the third and fourth quarters and truck manufacturers trying to get into balance for impending pre-buy.
[June State of the Industry: Classes 5-8 Vehicles Preliminary Update] - Preliminary Class 8 Truck Net Orders Jump in May, Beating Expectations
Read more here: https://t.co/891OVkGUrk#truck #semitruck #trucking #transportation, #Class8, #ACT, #ACTResearch pic.twitter.com/caUBOPEg5B — ACT Research (@actresearch) June 5, 2024
“While we do not have complete visibility at this point, the strength is presumably driven by private and vocational fleets, supplemented by an ongoing healthy appetite for equipment in Mexico,” Tam said.
FTR Transportation Intelligence issued a report that said Class 8 preliminary net orders for May came in at 18,900 units, which is up 25% month-over-month and 37% year-over-year. The report noted this level of orders is above recent demand trends and the average over the past decade for May. It concluded that this level further abates rapid demand decline concerns.
“OEMs are actively filling build slots at a steady pace,” said Dan Moyer, senior analyst of commercial vehicles at FTR. “Along with the month-over-month increase, the fact that orders were up significantly from the May 2023 level indicates that the market remains on a solid footing despite near-term challenges. While all OEMs experienced order growth, vocational markets stood out as particularly strong compared to on-highway.”
The completely reimagined powertrain in the #AllNewVolvoVNL delivers greater performance and efficiency than ever before. pic.twitter.com/wriKvRzwoc — Volvo Trucks North America (@VolvoTrucksNA) June 4, 2024
Moyer added fleets remain willing to invest in new equipment despite stagnant freight markets. He noted that order levels slightly exceeded historical averages and seasonal expectations, and he is anticipating a replacement level of output by the end of 2024. FTR also found Class 8 orders for the past 12 months totaled 273,900 units.
“We saw a stronger month of May industrywide than what many predictions would have suggested,” said Magnus Koeck, vice president of strategy, marketing and brand management at Volvo Trucks North America. “Stronger-than-anticipated numbers can be attributed to several factors: OEMs are opening their remaining order board slots for 2024, and the private fleets are slowly starting to engage in an early 2027 pre-buy. The early movers on the pre-buy may also indicate that the pre-buy effect will be a little stronger during the last six months of 2024 than earlier anticipated.”
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Volvo Trucks North America is launching its new Class 8 VNL tractor. The redesign is the first major overhaul of its flagship over-the-road truck since 2017. Koeck considers it the most significant product launch in the history of the company. He is anticipating stronger third- and fourth-quarter numbers this year because of the launch and other product lines.
“Class 8 tractor orders increased more than 42% for the combined U.S. and Canada markets compared with April,” said Jonathan Randall, president of Mack Trucks North America. “While the tractor market has faced headwinds from low freight pricing, the economy continues to grow on trend with solid orders. The vocational market remains strong, influenced by robust government construction spending.”
