ACT Research: Classes 5–8 Production Relative to Build Plan Fell Short in February
According to ACT Research’s latest State of the Industry: NA Classes 5–8 report, February heavy-duty and medium-duty production relative to build plan each fell short. The Class 8 build rate in February was 1,277 units per day (upd), up 13.9% y/y, but down 7.6% m/m, and 7.4% below industry build plan. Classes 5–7 build averaged 872 upd in February, -5.8% y/y, but +5.5% m/m.
According to Eric Crawford, ACT Research’s Vice President, Senior Analyst, “Trucking industry demand rolls on seemingly unabated, with retail sales unphased by higher interest rates, as pent-up demand remains for now. Encouragingly, Class 8 retail sales remain robust, and February HD orders rebounded off a particularly weak January. That said, we expect momentum to shift in second half of ’23, as the Fed continues its aggressive push to subdue inflation.”
Regarding backlog, he noted, “The backlog of unbuilt medium-duty and heavy-duty Classes 5–8 orders declined 4,300 units to 368,800 units (371k seasonally adjusted), representing a second consecutive month of decline. Class 8 backlogs declined 1.2% to 230,800 units, while Classes 5–7 backlogs declined 1.0% to 138,000 units.”
Crawford concluded, “On a seasonally adjusted basis, and at February’s build rate, the heavy-duty BL/BU ratio remained flat at 7.8 months (8.6 months nominal), and Classes 5–7 BL/BU ratio declined to 7.2 months (7.5 months nominal), from 7.5 months in January. Of note, 93.5k units in backlog are scheduled for the second half of 2023, considerably below the 133k units scheduled for 2022’s second half this time last year.”
ACT’s State of the Industry: NA Classes 5–8 report provides a monthly look at the current production, sales, and general state of the on-road heavy and medium duty commercial vehicle markets in North America. It differentiates market indicators by Class 5, Classes 6–7 chassis and Class 8 trucks and tractors, detailing measures such as backlog, build, inventory, new orders, cancellations, net orders, and retail sales. Additionally, Class 5 and Classes 6–7 are segmented by trucks, buses, RVs, and step van configurations, while Class 8 is segmented by trucks and tractors with and without sleeper cabs. This report includes a six-month industry build plan, backlog timing analysis, historical data from 1996 to the present in spreadsheet format, and a ready-to-use graph package. A first-look at preliminary net orders is also published in conjunction with this report.
ACT Research is recognized as the leading publisher of commercial vehicle truck, trailer, and bus industry data, market analysis and forecasts for the North America and China markets. ACT’s analytical services are used by all major North American truck and trailer manufacturers and their suppliers, as well as banking and investment companies. ACT Research is a contributor to the Blue Chip Economic Indicators and a member of the Wall Street Journal Economic Forecast Panel. ACT Research executives have received peer recognition, including election to the Board of Directors of the National Association for Business Economics, appointment as Consulting Economist to the National Private Truck Council, and the Lawrence R. Klein Award for Blue Chip Economic Indicators’ Most Accurate Economic Forecast over a four-year period. ACT Research senior staff members have earned accolades including Chicago Federal Reserve Automotive Outlook Symposium Best Overall Forecast, Wall Street Journal Top Economic Outlook, and USA Today Top 10 Economic Forecasters. More information can be found at www.actresearch.net.
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