January Truck Sales Plummet
Total Is Lowest Since ’03, but Orders Improve
By Frederick Kiel, Staff Reporter
This story appears in the Feb. 18 print edition of Transport Topics.
Class 8 truck sales plummeted 48.3% in January, compared with totals from a year ago, as dealers moved only 9,600 vehicles, the lowest number since the depths of the previous sales collapse, in 2003, according to data from WardsAuto.com.
At the same time, however, another research firm, A.C.T. Research, reported that new truck orders during January exceeded 20,000 for the fourth month in a row, a reasonably healthy level.
“We seem to have hit a floor with a cushion,” Ken Vieth, partner of A.C.T. Research, told Transport Topics. “You can’t just look at any one month’s orders like January, but if we include the rise in the fourth quarter as well — which wasn’t anything to write home about, but at least it was better than the summer — we can at least say that things haven’t gotten any worse.”
Sales did not start to collapse in 2007 until April, when 13,373 were sold, hitting a low of 9,677 in September. Monthly sales then rose 10,000-12,000 in the final quarter of last year, and the total for 2007 was 150,965.
“Class 8 net new orders for January were 22,100 . . . up 86%” from a year earlier, Peter Nesvold, transportation analyst for Bear, Stearns & Co., wrote in his Feb. 5 newsletter. He said January was the fourth consecutive month of more than 20,000 orders.
Nesvold compared the downturn favorably to the two previous ones.
“It took about 16 to 17 months in the prior two cycles to go from a trough in net new orders to the first occurrence of three consecutive months of 30,000 net new orders in the Class 8 segment,” Nesvold wrote.
“Our sense is that, given the short period of time between regulations this cycle (i.e., three years from January 1, 2007, to January 2010), we will see orders rebound faster than in prior cycles.”
The January total is the lowest since the first quarter of 2003, when monthly U.S. Class 8 sales ranged from 8,124 to 8,808 (7-23, p. 1).
Wards measures sales only in the United States, while truck orders include vehicles also destined for Canada, Mexico and overseas export. The lead time between an order and a sale can vary widely. Some companies order trucks to be delivered at staggered intervals up to a year into the future.
Manufacturers and dealers took a more cautious view of 2008.
“We’re pleased that we’re showing an upward trend that we trace to the successful acceptance of our new ProStar over-the-road,” Roy Wiley, International spokesman, told TT. “But the retail business is still basically flat. We don’t know if the upturn in orders is sustainable.”
“We anticipate that the total North American market for heavy-duty trucks this year will be very similar to 2007,” Mack spokesman John Walsh told TT, in a comment similar to Volvo Trucks North America spokesman Jim McNamara. The other truck makers declined comment.
“Sales continue to be very soft,” Tim Noeding, general sales manager of the three-dealer Freightliner, Sterling, Western Star of Arizona, based in Tolleson, Ariz, told TT. “We’re making steady medium-duty sales and heavy-duty as well, but mostly in municipal and extreme-duty types. We’ve seen the greatest difficulty and softest market in selling over-the-road trucks.”
“We don’t know whether increased sales will carry over from last year,” Gary Gibson, president of Tri-State Sterling Trucks Inc., Cincinnati, told TT. “Just after the first of the year, we noticed an increase in activity, with customers much more active in seeking quotes and looking at options. Other dealers noted it, too, but it has since halted, and we don’t know when it’ll return.”
Chris Fisher, senior commercial vehicle analyst at Power Systems Research, St. Paul, Minn., follows heavy-duty production trends, rather than sales or orders.
“Production of Class 8s has been pretty slow so far in 2008,” Fisher told TT. “Production hasn’t ramped up like we thought it would. There’s been a little movement in January, but overall it’s going along pretty much the same lines as last year.”
International Truck and Engine Corp. sold the most Class 8s in January, 2,456, for a 25.6% market share, Wards said.
Freightliner Trucks was just behind at 2,436 for a 25.4% market share. Daimler’s Sterling Trucks sold 471 units for a 4.9% market share and its other subsidiary, Western Star, sold 100 trucks for a 1% share.
Volvo Trucks North America sold 1,474 Class 8s for a 15.4% share, while sister Mack Trucks sold 545 units for a 5.7% share.
Paccar Inc.’s two truck makers were grouped close together. Peterbilt Motors Co. sold 1,085 vehicles for 11.3% of the market, and Kenworth Truck Co. sold 1,015, or 10.6%.
This story appears in the Feb. 18 print edition of Transport Topics.
Class 8 truck sales plummeted 48.3% in January, compared with totals from a year ago, as dealers moved only 9,600 vehicles, the lowest number since the depths of the previous sales collapse, in 2003, according to data from WardsAuto.com.
At the same time, however, another research firm, A.C.T. Research, reported that new truck orders during January exceeded 20,000 for the fourth month in a row, a reasonably healthy level.
“We seem to have hit a floor with a cushion,” Ken Vieth, partner of A.C.T. Research, told Transport Topics. “You can’t just look at any one month’s orders like January, but if we include the rise in the fourth quarter as well — which wasn’t anything to write home about, but at least it was better than the summer — we can at least say that things haven’t gotten any worse.”
Sales did not start to collapse in 2007 until April, when 13,373 were sold, hitting a low of 9,677 in September. Monthly sales then rose 10,000-12,000 in the final quarter of last year, and the total for 2007 was 150,965.
“Class 8 net new orders for January were 22,100 . . . up 86%” from a year earlier, Peter Nesvold, transportation analyst for Bear, Stearns & Co., wrote in his Feb. 5 newsletter. He said January was the fourth consecutive month of more than 20,000 orders.
Nesvold compared the downturn favorably to the two previous ones.
“It took about 16 to 17 months in the prior two cycles to go from a trough in net new orders to the first occurrence of three consecutive months of 30,000 net new orders in the Class 8 segment,” Nesvold wrote.
“Our sense is that, given the short period of time between regulations this cycle (i.e., three years from January 1, 2007, to January 2010), we will see orders rebound faster than in prior cycles.”
The January total is the lowest since the first quarter of 2003, when monthly U.S. Class 8 sales ranged from 8,124 to 8,808 (7-23, p. 1).
Wards measures sales only in the United States, while truck orders include vehicles also destined for Canada, Mexico and overseas export. The lead time between an order and a sale can vary widely. Some companies order trucks to be delivered at staggered intervals up to a year into the future.
Manufacturers and dealers took a more cautious view of 2008.
“We’re pleased that we’re showing an upward trend that we trace to the successful acceptance of our new ProStar over-the-road,” Roy Wiley, International spokesman, told TT. “But the retail business is still basically flat. We don’t know if the upturn in orders is sustainable.”
“We anticipate that the total North American market for heavy-duty trucks this year will be very similar to 2007,” Mack spokesman John Walsh told TT, in a comment similar to Volvo Trucks North America spokesman Jim McNamara. The other truck makers declined comment.
“Sales continue to be very soft,” Tim Noeding, general sales manager of the three-dealer Freightliner, Sterling, Western Star of Arizona, based in Tolleson, Ariz, told TT. “We’re making steady medium-duty sales and heavy-duty as well, but mostly in municipal and extreme-duty types. We’ve seen the greatest difficulty and softest market in selling over-the-road trucks.”
“We don’t know whether increased sales will carry over from last year,” Gary Gibson, president of Tri-State Sterling Trucks Inc., Cincinnati, told TT. “Just after the first of the year, we noticed an increase in activity, with customers much more active in seeking quotes and looking at options. Other dealers noted it, too, but it has since halted, and we don’t know when it’ll return.”
Chris Fisher, senior commercial vehicle analyst at Power Systems Research, St. Paul, Minn., follows heavy-duty production trends, rather than sales or orders.
“Production of Class 8s has been pretty slow so far in 2008,” Fisher told TT. “Production hasn’t ramped up like we thought it would. There’s been a little movement in January, but overall it’s going along pretty much the same lines as last year.”
International Truck and Engine Corp. sold the most Class 8s in January, 2,456, for a 25.6% market share, Wards said.
Freightliner Trucks was just behind at 2,436 for a 25.4% market share. Daimler’s Sterling Trucks sold 471 units for a 4.9% market share and its other subsidiary, Western Star, sold 100 trucks for a 1% share.
Volvo Trucks North America sold 1,474 Class 8s for a 15.4% share, while sister Mack Trucks sold 545 units for a 5.7% share.
Paccar Inc.’s two truck makers were grouped close together. Peterbilt Motors Co. sold 1,085 vehicles for 11.3% of the market, and Kenworth Truck Co. sold 1,015, or 10.6%.
