Class 8 Truck Orders Show Second Straight Gain in February
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North American Class 8 truck orders increased year-over-year for the second month in a row during February, according to ACT Research.
ACT preliminary data showed orders climbed 17.4% to 27,700 units from 23,600 during the same time in 2023, and went up 2.6% from the 27,000 units reported the previous month.
“Weak freight and carrier profitability fundamentals, and large carriers guiding to lower [capital expenditure] in 2024, would imply pressure in U.S. tractor, the [North American] Class 8 market’s largest segment,” said Kenny Vieth, president and senior analyst at ACT. “While we do not yet have the underlying detail for February order volumes, Class 8 demand continuing at high levels again this month suggests that U.S. buyers continue as strong market participants.”
ACT also noted the seasonal adjustment reduces the intake number for the month to 25,600 units. This is because the month has the fourth-largest seasonal factor. Classes 5-7 net orders also saw an increase at 7% year-over-year to 18,800 units.
Vieth
“The typical three-year trade cycle was disrupted by the pandemic freight bubble and equipment shortages, but the industry seems to be moving past that phenomenon,” said Chris Visser, director of specialty vehicles at J.D. Power. “The model-year 2025 order cycle started out relatively strong and appears to be settling in to the more mature phase of the buildout. Orders approaching 28,000 suggest positive momentum for build and deliveries.”
Visser added that despite industry talk of a freight recession, contract rates still are strong by historical standards. He suspects this year should be relatively normal for orders and deliveries and that pre-buy order activity should become a factor next year.
[March State of the Industry: Classes 5-8 Vehicles Preliminary Update] - Strong Class 8 Truck Orders Continue in February
Read more - https://t.co/5g0tV9nWu8#truck #semitruck #trucking #transportation, #Class8, #ACT, #ACTResearch pic.twitter.com/hb1aERdzCh — ACT Research (@actresearch) March 5, 2024
Randall
“Ongoing supply constraints along with strong demand the past few years have required OEMs to control their order boards based on availability versus traditional seasonal patterns,” Mack Trucks North America President Jonathan Randall said. “While there is less pressure on the supply, challenges still exist leading to controlled release of production slots. Pent-up demand of unmet production carrying into 2024 is working to smooth out orders and help in a market with expected decline in the longhaul segments. Also helping is the robust performance of the vocational market.”
FTR Transportation Intelligence noted in a report that Class 8 preliminary net orders for February increased 11% year-over-year to 25,700 units and were down 9% from January. The report also noted that the order number is consistent with recent demand trends and is above seasonal expectations. It added orders for the past 12 months have totaled 263,700 units.
Starks
“Build slots continue to be filled at a reasonable rate,” FTR Chairman Eric Starks said. “With February orders coming in at a rate that was comparable to December 2023, the market is still performing at a solid level. It was a mixed market for OEMs this month with some seeing increases and others seeing decreases in orders.”
FTR also noted that concerns over a rapid easing of demand this year are not coming to fruition nor is the market doing significantly better than replacement level orders. It added that after peaking last November at 36,000 units, orders have stabilized at a level about 10,000 units lower over the past three months.
“Despite the weakness in the freight markets that has persisted for more than a year, fleets continue to be willing to order new equipment,” Starks said. “Order levels were above the historical average and above seasonal trends, but our expectations for replacement output by the end of this year remain unchanged.”
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