Class 8 retail sales for 2009 are expected to be 43 percent below 2008 levels, according to ACT Research's recently published North American Commercial Vehicle Outlook.
In 2010, sales are only expected to recover about half the losses.

Within the medium-duty Class 5-7 market, vehicles will decline 26 percent this year, and will increase 11 percent in 2010, ACT predicted.

"Orders failing to arrive in sufficient numbers through May all but removed the possibility of an EPA 2010-driven bounce in 2009," said Kenny Vieth, ACT partner and senior analyst. "With significant excess capacity in the trucking industry and no expectation of a strong rebound coming out of the recession, the Class 8 fleet will end 2010 at the oldest average age on record."

Class 5-7 retail sales were off 54 percent last month from May of 2008, but continued low production output has reduced inventory levels to a 41-month low. However, the inventory-to-sales ratio in the medium-duty market is now at 7 months, more than double normal levels. The trend is similar in the Class 8 market, where retail sales fell 52 percent from last May, but the inventory-to-sales ratio is only 3.4 months.

"Although the low inventory is a positive," said Steve Tam, ACT Vice President - Commercial Vehicle Sector, "at current depressed sales levels, the Classes 5-7 market will have to improve significantly to justify ramping up production."

According to the research company, demand for trailers is also being affected by the recession. In addition, trailers are lasting longer these days due to structural issues. Total trailer shipments should drop 49 percent this year, the lowest in 47 years. Next year looks brighter for trailer sales, which are expected to rise 79 percent.

More info: www.actresearch.net.