ACT Research: Commercial Vehicle Market Forecasts Upgraded in October



According to ACT Research’s latest release of the North American Commercial Vehicle OUTLOOK, after pulling the cycle forward in September, ACT’s front-of-the-cycle forecasts were marked up across the board again in October.

The outlook is a report that forecasts the future of the commercial vehicle industry, looking at the next one to five years, with the objective of giving OEMs, Tier 1 and Tier 2 suppliers, and investment firms the information needed to plan accordingly for what is to come. The report provides an overview of the North American markets and takes a deep dive into relevant, current market activity to highlight orders, production and backlogs, shedding light on the forecast. Information included in this report covers forecasts and current market conditions for medium and heavy-duty trucks/tractors and trailers; the macroeconomics of the US, Canada and Mexico; publicly-traded carrier information; oil and fuel price impacts; freight and intermodal considerations; and regulatory environment impacts.

“Central to our growing bullishness on current activity translating into the next up-cycle are the non-traditional drivers of current freight market strength, even as more traditional drivers remain in the wings,” Kenny Vieth, president and senior analyst for ACT Research, said. “We’re seeing a COVID-driven consumer and business substitution of spending from services to goods, and while a vacation or business trip doesn’t fit into a truck, lumber and technology do.”

“Low interest rates, millennial demographics and urban escapes have supercharged residential investment, and we’re also seeing the need for a period of business inventory restocking that should benefit truck freight into mid-2021. By Q1/21, the current manufacturing cycle will hit a nine-quarter downturn, suggesting a tightly coiled spring of pent-up demand, also good for freight and ultimately commercial vehicle demand. That said, our thesis does rest on three impactful caveats: a successful COVID vaccination program in place by around the second quarter of next year, Congress passing significant legislation to support left-behind economic sectors and the potential for a flood of drivers into a market that still has considerable parked equipment, thereby blowing-up the favorable rate environment that fleets are enjoying currently.”

As previously reported, ACT Research also recently revealed plans for a new multi-client study focusing on electrification of the commercial vehicle industry to be released in 2021.

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