Commercial Vehicle Supply Constraints Dictating Lower Production Forecasts

According to ACT Research’s recently released Transportation Digest, near-term signs of demand for commercial vehicles remain strong, while supply constraints are keeping ACT Research’s forecasts for the next year under pressure.

“For heavy trucks, no less than for medium and light vehicles, procuring supplies and assembling product has become a top management priority,” Kenny Vieth, president and senior analyst for ACT Research, said. “The struggles of manufacturers, particularly with semiconductors, were typified in an OEM press release on Oct. 4. What holds for that particular OEM is true for all makers of heavy-duty trucks in North America. Indeed, it applies across all vehicle classes and global geographies. The semiconductor problem has become more acute as we have progressed through this year and appears set to hobble the industry well into 2022 — and perhaps even beyond. And semiconductors and electrical assemblies are not the only components experiencing either capacity shortages or rapidly escalating prices, or both.”

Vieth explained how these trends will impact future commercial vehicle production, saying, “ACT has rolled back heavy-duty truck forecasts in the past, but that was when the economy weakened and freight declined. This circumstance is unique: a forecast haircut when demand is strong, customers are increasingly eager to obtain trucks and backlogs are rising. With still-healthy demand, our focus is on supply constraints, inflation and production issues because they are the levers that will dictate market direction in the next few quarters.”

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