ACT: ‘Perfect Storm’ of Positives Causes Sharp Upgrades in CV Expectations Since May

According to the recent release of ACT Research’s Commercial Vehicle Dealer Digest, the unforeseen robustness of a “perfect storm” of positives positives into late spring and summer following the initial shock of COVID-19 shutdowns and other mitigation efforts has resulted in sharp upgrades in commercial vehicle expectations since May.

The report, which combines ACT’s proprietary data analysis from a variety of industry sources, paints a picture of trends impacting transportation and commercial vehicle markets. This monthly report includes a forecast summary — including transportation insights for use by commercial vehicle dealer executives — reviewing top-level considerations such as for-hire indices, freight, heavy and medium duty segments, the total U.S. trailer market, used truck sales information and a review of the U.S. macro economy.

“There have been a number of factors that have contributed to significantly better freight outcomes in spite of the dramatic economic downturn that continues to negatively impact significant swaths of the U.S. economy. One of the biggest surprises is illustrated by real personal consumption,” Kenny Vieth, president and senior analyst of ACT Research, said. “Since consumers couldn’t spend on experiences like vacations, sporting events and concerts, they put that money to work buying goods. Summer vacation doesn’t fit into a truck but stuff does.”

Specifically regarding how the CV industry is doing, Vieth said, “On top of the consistent roll-out of good economic numbers from consumer activity, the sustained rally to record highs in dry van truckload spot rates reflects the sizable piece of the driver supply that was sidelined in April. The resulting rise in carrier profits bodes well for commercial vehicle demand. Even in the face of significant parked capacity right now, a case can be made for a steady, if historically modest, Class 8 market rebound from here.”

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