Preliminary North American Class 8 truck orders see declines

Preliminary North American Class 8 orders were underwhelming in November, according to data issued respectively this week by freight transportation consultancy FTR and ACT Research, a provider of data and analysis for trucks and other commercial vehicles.

FTR reported that preliminary North American Class 8 orders, at 17,300 units, was down 21% compared to October, representing the lowest November tally going back to 2015, while marking a 39% annual decline.

FTR said that these numbers highlight how fleets remain extremely cautious heading into 2020, placing small orders and not extending orders much beyond the first quarter.  And it added that a couple OEMs reported decent order activity, but total orders fell below expectations. Class 8 orders for the past 12 months have now totaled 180,000 units.  

“The fall order season has gotten off to a slow start,” said Don Ake, FTR vice president commercial vehicles, in a statement. “Freight growth has stalled from the high rates of last year. This is causing fleets to be much more measured in their ordering for 2020. There still will be plenty of freight to haul, so we expect fleets will continue to be profitable and to replace older equipment. However, there won’t be a need for much additional equipment on the roads. There is still a great deal of uncertainty in the environment, which is creating apprehension in the trucking industry. Manufacturing has receded for four straight months, slowing economic growth. The trade war and tariffs are destabilizing prices and supply chains. And the tumultuous political climate just adds to an uneasy mix. The industry thrives on stability, but we are now on a rocky road.”

ACT’s data was in line with FTR’s, with the firm reporting that preliminary Class 8 net orders, for November, at 17,500, were off 20% compared to October.

“Preliminary November data show that Class 8 net orders failed to sustain October’s encouraging start to the order season,” said Tim Denoyer, ACT’s Vice President and Senior Analyst, in a statement. “The freight market downturn worsened in the past month and uncertainty surrounding trade and tariffs continue to weigh on truck buyers’ psyches. With rising pressure on carrier profits from the combined impact of lower rates and the recent, rather sudden jump in insurance premia, recent events have not developed in the industry’s favor. While private fleets continue to add capacity on the retail end, the market is increasingly heeding for-hire price signals and the stage is being set to right-size the fleet, bringing it closer to equilibrium with the work to be done.”