'Subdued' May Class 8 Orders Reflect Economic Uncertainty Caused by Pandemic Lockdowns

May orders for Class 8 trucks, while up significantly from the dismal April levels, were still down nearly 40% compared to last year, according to preliminary figures from ACT Research and FTR.

FTR reported a "subdued" order level of 6,600 units, while ACT reported 6,700 units. That’s up around 60% from April, depending on which company’s numbers you look at, but down 37-38% from last year. According to FTR, Class 8 net orders for the last 12 months total 155,000 units.
 
Fleets remain reluctant to order trucks, with a patchwork of varying COVID-19 restrictions across most states causing economic turmoil. Orders are expected to continue to increase modestly, according to FTR. Freight volumes have picked up some after bottoming out in Mid-April. The recovery is expected to be slow and uneven, FTR notes, saying June should be a better indicator as more economic activity resumes.
 
“Most of the country still had some severe restraints in place for part of May,” said Don Ake, vice president commercial vehicles. “It is difficult for fleets to plan for future equipment needs under these highly abnormal conditions. Carriers are more worried about what’s happening today, about their manpower needs and short-term issues, than ordering trucks.”
 
Medium-duty truck orders, Class 5-7, improved 5.3% from the previous month but were down 57% from the year-ago May volume, according to ACT.

“Reflecting the state of the broader economy, there was little to cheer about in May’s industry order activity,” said Kenny Vieth, ACT president and senior analyst, also nothing the impact of COVID-related lockdowns at the start of the month and a slow reopening occurring through May in most areas.

In addition, Vieth noted, “Restarting the manufacturing sector from a full stop was only partly successful, as Mexico’s lockdowns remained in effect well after the U.S. began to reopen, resulting in challenging supply-chain dynamics and fragmented supplier sourcing.”