“Weak freight market and rate conditions, as well as the residual backlog cushion, continue to bedevil new Class 8 order activity,” says Kenny Vieth, ACT president and senior analyst.
“Notably, January’s year-over-year result is the first positive Class 8 order comparison in 15 months and, while actual orders in January were below the Q4 average, they were more closely aligned on a seasonally adjusted basis,” Vieth says.
According to FTR, the January total decreased 10 percent month over month, but increased 12 percent year over year, which suggests fleets are ordering only the equipment they are sure they need in the short term. FTR expects Class 8 orders to remain in this narrow range through the first quarter of the year. Class 8 orders for the past 12 months have now totaled 181,000 units.
“The Class 8 market remains in equilibrium with orders well matched to production, stuck at close to replacement demand levels. Fleets remain profitable and are continuing to replace older units according to planned cycles. The smaller fleets are being more cautious because revenue is declining from the previous years,” says Don Ake, FTR vice president commercial vehicles.
“The freight market is still sluggish, but it has plateaued at a high level. The market is pausing to take a breather after a couple of banner years and the equipment market is stagnant as a result. Even though the trade deals have reduced the amount of economic uncertainty, the upcoming election is restricting business investment both inside and outside the industry,” Ake says.
ACT will publish complete industry data for January, including final order numbers, in mid-February. FTR’s final data for January will be available later in the month as part of its North American Commercial Truck & Trailer Outlook service.
