“Orders rose 28 percent versus year-ago February. That gain was only the third positive year-over-year comparison in the past two years,” says Kenny Vieth, ACT president and Senior Analyst. “Weak orders in 2016 and an improving economy should make positive year to year comparisons a monthly occurrence as we move through 2017.”
FTR echoed ACT’s 28 percent year-over-year improvement and said February’s orders also were up 5 percent month-over-month. The steady order trend has now pushed backlogs to over 100,000 units for the first time since June 2016. FTR says February’s solid order activity continued the trend that began in November, with market momentum picking up speed at a measured pace. The current order volumes should enable production to hit or exceed Q2 forecasts.
Class 8 orders for the past three months now annualize to 263,000 units, FTR says.
“February was another very encouraging month for Class 8 truck orders. Orders have increased for four straight months, indicating the market is making a solid recovery after the second-half slump in 2016,” says Don Ake, FTR vice president of commercial vehicles. “This order cycle is much flatter and longer than usual, but this is a healthy order total for a February. March orders may not decline that much. This is what a turning point looks like.”
In the Class 5, 6 and 7 markets, Vieth says preliminary orders of 22,700 were nearly identical to January’s final numbers.
“While actual orders were in-line, seasonal adjustment provides a drag in February versus a boost in January,” he says. “When seasonally adjusted, the net order volume drops to 21,450 units, down 11 percent compared to the seasonally adjusted January volume.”
Looking at Classes 5-8 as a whole, preliminary February data indicates industry net orders rose to a fourteen-month high, 45,900 units. That aggregate volume represents a 12 percent improvement compared to February 2016, ACT says.
“Freight is starting to pick again after sagging some in 2016. Rates are climbing and fleets are feeling much more confident about business going forward. Truck builds and sales should now begin a modest upturn which should continue throughout this year,” Ake says.
