January Truck Sales Jump 25%, Fueling Optimism in Industry

This story appears in the Feb. 21 print edition of Transport Topics.

Truck makers and dealers sold 9,236 Class 8 vehicles in the United States during January, a jump of 25% over January 2010’s pace, but about 2,500 below December’s strong results, WardsAuto.com reported.

Analysts and industry executives said the year-over-year increase provided another sign that the truck-building industry was climbing out of the recession.

“January’s heavy-duty sales, combined with December’s strong showing [11,742], was a good number for the industry’s outlook for 2011, considering where we were just a few months ago,” Chris Brady, president of Commercial Motor Vehicle Consulting, Manhasset, N.Y., told Transport Topics.

“We’ll see an upward trend in truck sales, gaining momentum as the year goes on and the recovery spreads to more industries,” he added.

Class 8 retail sales were under 8,000 three of the first five months last year, and under 9,000 in four other months, according to Wards.

“There’s usually an increase in sales in December for tax and depreciation reasons,” Brady said. “Truck sales generally taper off a bit in January because some fleets bought ahead of when they needed to.”

The January sales figures also come against a background of three straight months of strong orders data from November through January of more than 25,000 each month.

“The recent strong order data is not being seen in the sales data yet,” Jonathan Starks, director of transportation analysis, FTR Associates, Nashville, Ind., told TT. “We would anticipate a strong spring season for sales, starting in March — a typically strong month — as capacity tightens and freight starts to ramp back up following the late 2010 lull.”

Freightliner Trucks, a brand of Daimler Trucks North America, was the market leader in January with 3,170 sales, a 40.5% jump over its sales in the comparable month last year, Wards said.

DTNA declined to comment on January’s figures, but issued a statement on Feb. 14 saying that it planned to hire an additional 600 workers this year at its two Mexican production plants to expand heavy- and medium-duty truck building.

“We remain cautiously optimistic regarding economic and industry recovery, but this is a significant and welcome step forward,” CEO Martin Daum said in the statement.

Navistar sold 2,276 International trucks in January, just 3.9% above its sales a year ago, for second place with a 24.6% share of the market.

“January’s sales show that the recovery is perking in, and we haven’t scored as well on percentage gains as the others,” Navistar spokesman Roy Wiley told TT. “None of this is surprising for us, as our CEO Dan Ustian has consistently said that we’d have our big boost at the second half of the year.”

Both Paccar Inc. companies did well, with Peterbilt Motors selling 1,142 Class 8 trucks, a 34.4% gain from last year that gave it 12.4% market share, while Kenworth Truck Co. sold 1,034 heavy-duty vehicles, a 42.2% gain, for 11.2% of the market.

“The numbers reported by Wards . . . are consistent with our experience here in the Mountain West,” Kyle Treadway, president of Kenworth Truck Sales, a multi-state dealership based just outside Salt Lake City, told TT.

Treadway, also chairman of American Truck Dealers, said that a number of factors converged to ignite new truck sales, ranging from a lack of used trucks, the increasing age of fleets and promotional incentives from manufacturers.

Volvo Trucks North America and Mack Trucks Inc., both subsidiaries of Swedish-based Volvo AB, also managed solid gains in January over last year. Volvo sold 802 tractors, a 19.3% gain from January 2010, for 8.7% of the market; Mack sold 686 trucks for a 24.1% gain and a 7.4% market share.

DTNA’s other brand, the mostly vocational Western Star, sold 124 vehicles for a 125% gain over last January and 1.3% share of the Class 8 market.

W.M. “Rusty” Rush, CEO of Rush Enterprises, a Peterbilt and International dealer with 61 locations in the South and West, said although the sharp increase in orders was encouraging, he remained cautious.

“While U.S. Class 8 order intake has reached over 25,000 units for three consecutive months, retail sales are not expected to substantially increase until later in 2011,” Rush said in a Feb. 14 statement.

Rush said that most industry experts forecast that U.S. Class 8 truck sales would reach 179,000 units this year, up from 107,152 units sold in 2010.