North American Class 8 commercial vehicle preliminary net orders for June remained soft, according to two major industry research firms.< net="" orders="" for="" classes="" 5-7="" also="" fell="" below="" trend,="" but="" the="" decline="" was="" expected,="" as="" medium-duty="" activity="" typically="" tapers="" off="" during="" the="" summer="">
ACT Research predicts the final numbers, which will be released mid-July, will approach 16,500 units for heavy-duty Class 8 trucks and 12,900 for medium-duty Classes 5-7 vehicles. The preliminary net order numbers are typically accurate to within 5% of actual.
FTR Associates's June data shows Class 8 truck net orders at 16,195 units, the lowest month for orders since September 2010. June orders were 8% lower than May, dropping to 23% lower than the same month last year. 2012 orders for Class 8 trucks continue to disappoint, FTR said in a press release, with annualized rates coming in well below 2011 levels month after month. For the three-month period including June orders annualize to 202,700 units.
"The explanation for the soft patch remains of the 'death by a thousand cuts' variety," says Kenny Vieth, president and senior analyst, ACT Research. "As has been the case since late February/early March, the issue appears to boil down to credit-buying truckers' confidence in the economy relative to the risk of taking out a sizeable loan to buy a truck. To that end, risk, economic or political, domestic or global, remains high, and memories of 2009 are still fresh."
Jonathan Starks, FTR's Director of Transportation Analysis, commented that, "truckers are operating in a modestly positive environment, but not strong enough to elicit higher demand for expensive new vehicles. Growth in freight volumes and rates slowed noticeably during late 2011 and into 2012. Despite expectations that both will improve as we finish 2012, equipment markets will have to contend with the effects of last year's slowdown. Additionally, truck manufacturers continue to build at rates well above incoming orders. This will eventually lead to a significant reduction in new truck output."