ACT Research reported last week in its most recent Commercial Vehicle Dealer Digest that despite rock-solid demand across the spectrum of forward-looking medium- and heavy-duty vehicle market indicators, industry capacity remains range-bound across a broad front of supply-chain constraints.
“Ripples from pandemic-driven changes to economic relationships (WFH, PCE-goods) are still being felt in the form of constraints that are not localized and are beyond the CV industry’s ability to drive solutions,” says Kenny Vieth, ACT’s president and senior analyst. Vieth adds the explosion in demand for goods (semiconductors, steel) during a period of contagion has led to pandemic-driven failures in a globally reliant web of interrelated manufacturing supply chains. “Scaling complex global networks when demand is booming during a period of supply constraints, globally, has proven inadequate to the task pandemic-to-date.”
Vieth says this has left build rates stuck in neutral.
“Despite green lights, the everything shortage has left industry build rates stuck in neutral — on an incline. In October’s round of ACT truck and trailer statistics, aggregated North American Classes 5-8 and U.S. trailer industry build rates slipped 2 percent from September. That decline continued a trend of incremental build rate contractions through 2021,” he says.
Vieth also notes, “It appears the industry is likely to begin 2022 with still unfinished 2021 units. If you have parts on all those ‘built, but not built’ units, some adjustment will be required to align your 2021-2022 output with reported and forecast data.”