ACT Research confirmed the May drop in Class 8 orders was the result of cluttered order boards and not falling demand, the company wrote Friday in its Commercial Vehicle Dealer Digest.
After a torrent of orders from October to March, ACT President and Senior Analyst Kenny Vieth says orders hit a nine-month low in May as 2021 order boards were finalized and 2022 boards remained unopened. Referencing the company's record-setting market dashboard, Vieth says "the order lines on the dashboard graph illustrate the current rollover in the trend.
He adds, "a drop in the order trend preceded the opening of subsequent years’ orders in each of the last two cycles, with significantly higher orders booked ahead of the second year of the cycle. Given recent historical precedent, we would expect orders to rise materially in coming months.”
Vieth also notes while ACT Research expects orders will jump in early in the third quarter, there are two factors that could keep orders low for a bit longer.
"First, through all but the most recent cycle, OEMs have typically not opened out-year order books until September-October," he says. "Second, at a recent conference, an OEM executive indicated his company was at least contemplating some type of allocation system to best serve all of their customer constituencies in challenging market conditions."