Editor’s Note: This article originally appeared in HWT’s sister publication, Commercial Carrier Journal.
Class 8 truck orders dropped to 13,100 units last month, while Class 5-7 orders totaled just 15,200 units according to ACT Research.
The last time heavy truck order levels hit marks this low, the country was shedding the effects of an economic recession.
“The pace of commercial vehicle orders slowed in seasonal fashion into the first month of summer,” says Kenny Vieth, ACT’s president & senior analyst. “June’s [medium- and heavy-duty] net order total volume was the lowest monthly order total since July 2012. Seasonally adjusted, at 31,500 units, it was the lowest total since September 2012.”
FTR’s preliminary Class 8 net orders for June – the worst June since 2009 – show intake 8 percent below May and down 34 percent year-over-year. The annualized rate of orders continues to drop – 162,000 now for past three months, 185,000 for the past six months and 224,000 over the past 12 months.
“The Class 8 market is stuck in a holding pattern, at the bottom end of this cycle,” says Don Ake, FTR’s vice president of commercial vehicles. “Fleets are cautious as freight demand has cooled off this year. There are enough trucks to handle freight right now with carriers are in a wait-and-see mode, before adding trucks or replacing older units.”
Ake adds he does anticipate higher orders later this year, however, the volume of orders will likely be determined by the strength of the economy and freight activity at that time.
“This is what the summer looks like in a market down cycle, so we can expect this level of activity for a couple more months,” he says.
Vieth notes pull-back in medium duty orders reflect the past strength of that segment rather than current weakness.
“The pull-back of the past two months follows a three-month stretch from February to April in which medium duty orders were booked at a volume well ahead of demand,” he said. “Despite increasingly easy year-over-year comparisons, Class 8 vehicle orders continued to lose traction in June with orders slipping to 13,100 units. The last time actual Class 8 orders were this low was Q3’10.”