Class 8 Truck Sales Hit 2-Year High

This story appears in the Jan. 17 print edition of Transport Topics.

Truck manufacturers and their dealers sold 11,742 Class 8 trucks in the United States during December, the highest monthly total since December 2008, Wardsauto.com reported.

December’s sales were 1.8% above the same month a year earlier. For the entire year, sales were 107,512 units, up 13% from the 94,798 sold in 2009, Wards reported on Jan. 13.

Dealers said they expected sales to keep rising.

“We have more trucks on order than any time in the past three years, and we’re starting to feel very optimistic that we’ve finally turned the corner,” George Grask, president of Quad City Peterbilt, a two-location dealership based in Cedar Rapids, Iowa, told Transport Topics.

“I’m encouraged by the December numbers because first, they’re up sharply from the past few months and secondly, they confirm what our growing orders data has been showing,” said Eric Starks, president of transportation research firm FTR Associates.

Starks added there was a logical reason for the small year-over-year increase for December.

“Last December’s figure doesn’t concern me at all, because that was part of the very weak pre-buy of fleets who wanted to buy ahead of some tax changes, as well as getting the less expensive 2009 trucks,” he said.

All truck brands except for Kenworth Truck Co. showed an increase in 2010 Class 8 sales, and Kenworth’s decline was only 0.3%, according to Wards.

Freightliner Trucks, a division of Daimler Trucks North America, roared back from its second place finish in 2009 to grab first place, selling 3,419 heavy-duty trucks in December and 34,708 for the year, good for 32.4% of the market.

Freightliner’s sales increased 34.1% over its 2009 total of 25,884.

“We are pleased and gratified with 2010 sales results and the confidence customers are placing in our Freightliner and Western Star brands and Detroit Diesel BlueTec technology,” DTNA spokeswoman Amy Sills told TT. “We are seeing solid signs of recovery throughout our industry.”

Navistar Inc.’s International brand was second in market share both in December, selling 2,215 vehicles, and for the year, selling 26,581 vehicles to give it a 25.1% market share.

Freightliner’s 2010 market share  was more a result of it selling a much greater percentage of vehicles than in 2009, as International raised its sales, but only by 1.3% over 2009.

“Our sales are in line with our own projections as we implement our build and hold strategy,” Navistar spokesman Roy Wiley told TT. “We knew that our sales would fall late in 2010 and into the early part of this year, as we fine-tune our products, but we expect to come back strong in the last half of this year.”

Wiley defined “build and hold” as building its trucks and engines, often in separate factories, then putting them together and testing them to bring them to maximum efficiency.

Navistar was the only engine manufacturer not to use selective catalytic reduction technology to meet U.S. federal emission mandates that went into effect Jan. 1, 2010.

Instead, it chose what it calls “advanced exhaust gas recirculation,” which increases the amount of exhaust gases recycled in combustion.

No other truck maker returned requests for comment on sales by press time.

Peterbilt Motors overtook its fellow Paccar Inc. company Kenworth for third place in sales for 2010, selling 12,980 vehicles for 12.1% of the market.

Peterbilt sold 1,722 Class 8s in December and Kenworth sold 1,497. Kenworth sold 11,652 for the year, good for a 10.8% share.

Swedish-based Volvo AB’s two companies, Mack Trucks and Volvo Trucks North America, were next, both showing strong sales gains over 2009.

VTNA sold 1,213 trucks in December and 10,036 for the year to knock Mack out of fifth place with 9.4% of the market. VTNA’s sales gained 42% over 2009.

Mack sold 1,559 trucks in December and 9,209 for an 8.6% market share. Its sales were up 20.8% over 2009.

Daimler’s Western Star mostly vocational brand sold 1,171 trucks for the year for 1.1% of the market.

Dealers as well as manufacturers recognized that a bull market has not yet returned.

“We believe Class 8 truck sales in 2011, while improved over recent years, will primarily reflect vehicle replacement needs and not true growth.” W.M. Rush, CEO of Rush Enterprises Inc., a major dealer of Peterbilt and International trucks in the South and Southwest, told TT. “We do anticipate that should economic conditions improve, 2012 and 2013 could be even stronger markets for new truck sales.”

“For our markets, we’re only seeing replacement-type orders,” Kyle Treadway, president of Kenworth Sales Co., West Valley City, Utah, told TT.

“Buyers aren’t necessarily bullish on their growth, but rather they’re faced with necessary replacements,” Treadway, who is also chairman of the American Truck Dealers association, said.  “Their costs of maintenance and repair are now surpassing the monthly cost of new equipment purchases.”