ACT Research: 2021 Commercial Vehicle Production a Question of Supply, Not Demand

According to the latest release of ACT Research’s North American Commercial Vehicle OUTLOOK, the question of commercial vehicle demand for 2021 has already been answered, but the number of units to be built this year remains a question of supply.

“In previous months, we have used 2018 as a corollary for achievable Class 8 output in 2021: From a nearly identical January production rate starting point, the industry managed to build nearly [325,000] units in 2018,” Kenny Vieth, president and senior analyst for ACT Research, said. “Getting to that 2018 volume included the supply chain working through not only transitory ramp-up/synchronization issues but also labor constraints in the full-employment economy of that time.

“From a commercial vehicle demand perspective, orders, from medium-duty trucks to heavy-duty tractors and trailers, remain elevated, with backlogs for tractors and van-type trailers, at current build rates, pushed out 12 months. That order-to-build lag more than doubles traditional ranges for backlog-to-build ratios.

“In 2021, those early cycle challenges are starting to moderate, only to be replaced by new capacity constraints in this period of synchronized global economic expansion amid an ongoing pandemic. The list of constraints remains long and includes chip and steel shortages, as well as plastic resin production impacted by power failures in Texas, backlogged throughput at ports and pandemic supply-chain challenges like keeping and growing staff.”

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