Truck Sales Start ’15 Strong

This story appears in the Feb. 16 print edition of Transport Topics.

U.S. retail sales of Class 8 trucks kicked off this year with the same vigor they used to plow through 2014, surging 22.8% in January to 17,373 units, according to WardsAuto.com.

That was the highest total for the first month of a year since 2007, when OEMs sold just over 18,500 units. However, that strong figure was attributed to purchases recorded in January, even though they were actually 2006 “pre-buy” models manufactured before new federal emissions standards kicked in.

Stephen Volkmann, an analyst with Jefferies & Co., said last year’s strong showing — in which sales rose 19% to 220,400 trucks — was likely to continue in 2015 coming off several down years.

“We have been expecting this for quite a while,” Volkmann said. “We had a good year last year, and I expect a good year this year and in 2016, as well.”

After the 2006 pre-buy boom, the industry had about five years of “very depressed markets, which extended the age of trucks to pretty much historic highs,” he told Transport Topics.

“Now we’ve started the process of replacing and upgrading the fleet, and that process is going to take a while,” he said.

Volkmann noted that new trucks offer buyers gains in fuel efficiency and “uptime” compared with older models.

The combination of tight, post-recession hauling capacity and a strong supply of freight to be moved means that, “at some point, we’ll probably need to flex the fleet up a little, which should also drive additional sales,” he said.

Ward’s reported that sales of Daimler Trucks North America’s Freightliner brand totaled 7,755 in January, a 44.7% increase from a year ago.

Freightliner’s leading market share was 44.6% for the month, a jump from 37.9% last January. DTNA

also sold 325 of its niche Western Star brand trucks, a 77% year-over-year gain.

“January retail sales have provided an excellent jump-start into a strong 2015,” said Diane Hames, DTNA’s general manager for marketing and strategy.

The OEM “started the year with strong backlogs and both customer commitment and demand for our integrated powertrain and trucks,” Hames said.

Peterbilt Motors Co. and Kenworth Truck Co., both units of Paccar Inc., held the second and third spots in market share, with 12.9% and 12.5%, respectively.

Peterbilt’s sales rose 19.6% to 2,238, while Kenworth’s gained 27.1% to 2,171.

Volvo Trucks sold 1,727 trucks in January, up 14.8% from a year ago, for a 9.9% market share.

“Strong January truck sales, in a month which is typically slower industrywide, are further indication that 2015 will be a strong year for Volvo and the industry overall,” said Magnus Koeck, vice president of marketing and brand management for Volvo in North America.

Koeck, who noted the company’s recent higher projection of a 310,000-vehicle North American Class 8 market in 2015, said, “Positive customer response to the fuel-efficiency benefits offered by our proprietary powertrain and the Volvo I-Shift automated manual transmission contributed to our increase in retail sales.”

Mack Trucks, also part of Volvo Group, sold 994 trucks for the month, a 6% year-over-year increase.

Navistar International Corp. was the lone OEM with lower January sales, a total of 2,160, down 16.2% from a year ago. Its market share was 12.4%, down from 18.2% a year ago.

Bill Kozek, president of Navistar’s truck and parts business, said the company expects growth this year “in each of our product categories, with total unit growth ranging from 7,000 to 10,000 units versus last year, or 12% to 15%.”

“Class 8 market volumes in 2014 were at the highest levels since 2006,” Kozek said. “Improved new truck fuel economy, rising tonnage and improved transportation company profitability will continue to generate higher demand for Class 8 on-highway vehicles this year.”

Volkmann said that it wasn’t unusual for Navistar to be lower than its competitors in January, in part because its fiscal year ends in October, unlike the other OEMs.

“The other [OEMs] have programs in place to push products out the door in December, which then get sold to the end-user in January,” he said. “That’s fairly normal, but I think it’s also fair to point out that Navistar’s market share has regained slower than they had hoped.”