Class 8 Truck Sales Smash Record
Although it fell short of early-year predictions that ran as high as 220,000, the final total was high enough to warm the hearts of major manufacturers — and their stockholders.
The retail numbers for Class 8 trucks in the United States totaled 209,483, topping 1997 by 30,922, or 17.3%, and 1995 — the previous record year — by 8,179.
A strong economy was credited by many for the high rate of sales, although shorter replacement cycles also played a part. Some manufacturers saw the 1998 performance as evidence of the continuing strength of the truckload business.
But transportation analysts, while also citing the robust economy, characterized high sales in 1998 as part of a predictable replacement cycle.
“It is no big surprise,” said Timothy J. Quillen, of Stephens Inc., Little Rock, Ark. “Truckload carriers bought a lot in 1994 and 1995, and they generally operate on a cycle.”
Nevertheless, Mr. Quillen said a strong economy along with segment shifts — to truckload from less-than-truckload — provided the impetus for strong sales. He also cited the phenomenon of “deferred air freight” — freight that actually moves on land.
While he conceded that the sales will bring additions to the truck fleet, he doubted any big changes.
In other words, he said, there is little danger that the record sales will outstrip the carriers’ ability to provide drivers, producing excess capacity.
Thom Albrecht, of ABN AMRO Inc., Chicago, noted that a significant number of orders were cancelled, many due to concerns that poor economic conditions in Japan and elsewhere would lead to a global recession.
These fears were rising, he said, just as “fleets were doing their capital budgeting” and triggered a number of cancellations.
However, he said early ordering is almost always reduced by cancellations later in the year. Some companies were pressuring dealers to limit orders to those for which they have buyers, he added.
For the full story, see the Jan. 18 print edition of Transport Topics. Subscribe today.
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