Heavy commercial vehicle markets continue to benefit from a still-broad spectrum of supply and demand-side triggers, according to ACT Research in its most recent Commercial Vehicle Dealer Digest.
Three of the key considerations ACT has been reviewing include the fact that freight rate markdown is from record levels, the addition of new technologies such as better fuel economy, safety technologies and AMTs that weren’t available or being spec’d three to four years ago, and increased demand being generated for drop-and-hook operations to keep drivers (and freight) moving. The report provides monthly analysis on transportation trends, equipment markets, and the economy.
“Preliminary December Class 8 data marked slowing orders, but that slowing must be viewed in the context of near-record backlogs,” said Kenny Vieth, ACT president and senior analyst. “With Class 8 and trailer backlogs out more than ten months, the fleets who are normally in the market this time of year have already placed their orders in the rush to get into the queue that began mid-year.”
Vieth added, “While the supply-demand balance for fleets is softening at the margins, demand for heavy commercial vehicles remains strong, and upside production pressures in the first half of 2019 are considerable, given those big backlogs. Additionally, slower freight growth, an easing of driver supply constraints, the resumption of the long-run productivity trend, and strong Class 8 tractor fleet growth are expected to increasingly pressure rates and by extension, trucker profits in 2019.”
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