ACT Research: Classes 5-8 Economy Resilient Against Interest Rate Hikes
OCT 20, 2022 - 7:01 am
According to ACT Research’s latest State of the Industry: NA Classes 5-8 report, current economic conditions are resilient in the face of aggressive interest rate hikes. Heavy duty and medium duty net orders took huge steps up from August levels in September, with both on a nominal as well as seasonally adjusted basis.
“For now, business activity is winning the tug of war with higher interest rates,” Eric Crawford, VP, senior analyst at ACT Research, said. “That said, we expect this dynamic to shift in 1H’23, as the Fed continues its aggressive push to subdue inflation.”
“Production levels were ahead of OEM build plans for both heavy-duty (HD) and medium-duty (MD) by a considerable margin. Otherwise, activity was largely in line with expectations: 1) more Class 8 OEMs began opening 2023 orderboards, and 2) HD and MD cancellation volumes and rates remain low, albeit up from prior month for Class 8 following the record low set in August.” Crawford said. “While underlying economic activity remains elevated, the record-breaking orders were also a function of customers’ inability to secure as much equipment in 2021 and 2022 as they’d preferred, creating pent-up demand for 2023, as well as a burst of activity when 2023 orderboards were opened more broadly. In other words, had supply chain and labor issues not dampened 2022 build rates, or had 2023 build slots already been widely available for orders to be placed, we think orders would have been strong, but not record-breaking strong.”
Like this story? Begin each business day with news you need to know! Register now for FREE Daily E-News Broadcast and start YOUR day informed!
Bankruptcy filing statistics are important, but they only scratch the surface when it comes to assessing overall trends in the world of distressed businesses. Gregg Morin identifies some of the other metrics that matter and delves into what they’ve shown... read more
Being a leader in today’s equipment finance industry takes a sense of purpose, advocating for oneself and being flexible. Amy Gross, executive vice president of the commercial vendor and government divisions at Key Equipment Finance, says being a parent while... read more