ACT: U.S. Trailer Orders Gain in August But Remain Down Y/Y

Trailer net orders rose 52% month-over-month in August, but contracted a disappointing 37% year over year, according to the most recent data from ACT Research.

“Much of August’s improvement came from large fleet volume and the gains were not evenly spread across the competitive landscape,” said Frank Maly, director of CV Transportation Analysis and Research at ACT. “While negotiations continue regarding fleets’ 2017 equipment needs, there appears to be less enthusiasm in the discussions than reported earlier this summer. Overcapacity, lackluster [year-over-year] fleet financials for [Q2/16], and minimal expectations for improvement in freight rates are generating investment plan headwinds. After several years of solid and ever-earlier order placement, expect this order cycle to be less robust and straggling.”

In addition, ACT reported that Class 8 net orders rose to a three-month high of 14,200 in August, aided in part by cancellations, which fell to a 33-month low.

Seasonally adjusted, Class 8 orders were the best since March at 16,000 units. Medium-duty net orders were up month-over-month, totaling 17,100 units, in-line with the order trend in place since April.

“While down in August against traditional comparisons, Mexico remains the bright spot in the market as freight generation continues to benefit from peso weakness,” said Kenny Vieth, president and senior analyst at ACT Research. “A proposed emissions mandate at the start of 2018 is likely adding to market strength as truckers think strategically.”

Speaking on Classes 5–7, Vieth said, “With the consumer economy hitting on most cylinders, and without any irrational demand activity cycle-to-date (maybe a few months of peakiness early in the year as new products were ramped-up), there is good consistency in MD demand and steady-as-she-goes expectations remain in place.”

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