Class 8 Truck Orders Surged in October

Class 8 truck orders in October surged significantly from the previous month as the Fall ordering push began, according to preliminary numbers from ACT Research and FTR.

Net orders hit 35,700 units for the month, representing an increase of 62% compared to September and 167% above the same month last year, according to FTR. ACT Research also reported similar gains. Nearly every manufacturer saw an increase, through the growth was not uniform across all OEMs.

“The market seems well situated for a strong production environment to persist into 2018,” said Jonathan Starks, FTR chief operating officer. “FTR has been anticipating a strong 2017 fall order season since early this year. The market continues to follow our expectations and highlights that the market fundamentals remain solid as we approach 2018.”

Class 8 orders were stronger than expected, according to analysts at Stifel, and they could indicate a banner order season for the heavy-duty market.

"We expect orders will maintain strength in November and December (with November likely down m/m seasonally)," Stifel stated in a summary analysis of order numbers. "We also continue to believe the industry is set up for further growth in 2019-2020 (driven by increased replacement demand, improved carrier profitability, and reductions in effective capacity) as long as the freight market and broader economy hold up over that period."

Combined medium- and heavy-duty truck orders are projected to hit the highest point since Dec. 2014. The strength exhibited by Class 8 orders in October highlights improving freight conditions and freight rates that will lead to a rebound in carrier profitability in 2018, according to ACT Research. October is typically the second strongest order month of the year. Medium-duty, Class 5-7 orders were actually down slightly for the month, totaling 19,500 units.

“October’s preliminary orders clearly put upward pressure on ACT’s expectations for Class 8 demand next year,” said Kenny Vieth, president and senior analyst at ACT Research. “At the same time, we recognize the potential that this year’s NACV show may have pulled-forward the timing of orders that would normally have been placed through the fourth quarter.”