Improving freight conditions push truck orders to highest level in nearly 3 years
Preliminary data from ACT Research shows North American Class 5-8 truck orders hit 55,700 units in October, up 65 percent year-over-year. Growing Class 8 orders and medium-duty order activity that is generally in-line with forecast have boosted the industry’s order intake to a level not seen since December 2014.
ACT Research President and Senior Analyst Kenny Vieth says year-to-date, orders after seasonal adjustment have been consistent, ranging from 41,400 units in May to 48,900 units in October. North American Class 8 orders for the past twelve months have totaled 261,500 units, according to FTR and at 36,200 units, preliminary October Class 8 net orders surpassed expectations.
“October’s orders represented a 160 percent year-over-year jump from a particularly easy, cancellation impacted, year-ago comp,” Vieth says. “October is typically the second strongest order month of the year.”
Vieth says the strength exhibited by Class 8 orders in October reflects improving freight conditions and freight rates that will lead to a rebound in carrier profitability in 2018.
“The market seems well situated for a strong production environment to persist into 2018,” adds Jonathan Starks, chief operating officer at FTR.
“October’s preliminary orders clearly put upward pressure on ACT’s expectations for Class 8 demand next year,” he says. Vieth. “At the same time, we recognize the potential that this year’s NACV show [September] may have pulled-forward the timing of orders that would normally have been placed through the fourth quarter.”
“FTR has been anticipating a strong fall order season since early this year,” Starks adds. “The market continues to follow our expectations and highlights that market fundamentals remain solid as we approach 2018. Hurricanes Harvey and Irma merely exacerbated an already tight truck market so the strong order activity in October was no surprise to us.”