ACT Research: N.A. Commercial Vehicle Demand Reminiscent of 2018 at Start of 2021, But Facing Challenges
According to ACT Research’s (ACT) latest State of the Industry: NA Classes 5–8 Report, although 2021 is starting much like January of 2018, there are steep front-end challenges to production.
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.
“In 2018, the industry was beset with labor challenges reflected in sub-4% unemployment rates that posed production challenges through the first half,” said Kenny Vieth, ACT Research’s President and Senior Analyst. He added, “Similarly, factors are in place that mirror the beginning of 2018, and as then Class 8 production expectations are for significant growth in 2021. On top of pandemic-related challenges of keeping and growing staff are material shortage issues.” Vieth noted, “Most immediately, the industry is on the front-end of a silicon chip shortage. While chips have taken center stage, the diversion of oxygen production in Mexico from industrial to medical purposes and reports that steel has become increasingly challenging to secure are in the wings as potential constraints.”
By commercial vehicle segment, Vieth commented, “Even with these constraints, the economy is growing in all the right places for freight, with freight rates strong and carrier profitability rising. The fallout of this is reflected in Class 8 orders, especially for tractors, backlogs, and build rate pressures.” Regarding the medium-duty segment, he noted, “Like their bigger peers, the medium-duty market continues to put down strong numbers, reflecting strength in goods demand and construction.”
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.
ACT’s 64th Seminar is scheduled for February 23–25, 2021. Focused on the continuous evolution and advancement of power and energy changes in the transportation and commercial vehicle markets, OUTLOOK Seminar 64 will feature key industry leaders such as Ryan Reed of Wabash National, John Bennett from Meritor, Lance Riegel of Marvin Johnson, and Dominick Beckman from Hino Motors. Look for more details on this event over the coming months and save the date for February’s event. Click here for seminar information. www.actresearch.net/seminar64
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