October Class 8 Truck Orders Driven Largely by Segments with Lingering Pent-Up Demand
NOV 20, 2023 - 6:53 am
While strong relative to freight market conditions, Class 8 truck orders were down 24% year over year in October, according to ACT Research.
“Final Class 8 net orders were 32,287 units in October, with the largest drivers of orders being market segments with lingering pent-up demand,” Kenny Vieth, president and senior analyst at ACT Research, said.
The vocational straight truck market experienced a 24% year-over-year rise in orders in October, while the export market orders were up 91% year over year and orders destined for the Mexican market were up a 187%. Moving in the opposite direction, North American Class 8 tractor orders were down 34% year over year in October, with U.S.-only tractor orders down 47% from year-ago levels.
“The build rate declined nearly 10% [month over month], leading to 27,999 units of production in October. Anecdotes suggest supply chain issues were at the root of the below-expectations miss. Despite otherwise softening conditions, Q1/24 build expectations remain elevated,” Vieth said. “Class 8 build and retail sales continue to track closely, but retail sales ticked down this month, causing inventory to move higher. Classes 5-7 inventories remain elevated on pre-strike stocking and as medium-duty bodybuilders’ labor challenges persist.
“For carriers, the long bottom in freight rates continues, with spot rates little changed since April. A big driver of rate weakness has been lagged private fleet capacity additions. As for-hire fleets tend to be the first buyers in line, private fleets have been the drivers of Class 8 market strength in 2023, adding equipment at the bottom of the cycle and prolonging the rate pain.”
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