Two noted trucking industry analysis firms report disappointing North American Class 8 tractor orders for January continue a downward trend with net orders down month over month and year over year.
ACT Research figures show that for January, 18,200 Class 8 trucks were ordered — down 48 percent against a tough January 2015 comparison. Additionally, January volume was off 35 percent versus a better than expected December. January’s orders are the second lowest intake since mid-2012.
Kenny Vieth, ACT’s president and senior analyst, said, “Economic reports over the course of January were broadly disappointing, with industrial-related data points particularly soft. Ongoing weakness in the freight-intensive manufacturing sector continued to weigh on capacity utilization following a year in which Class 8 tractor retail sales fell just short of an all-time record.
“As a result of the soft supply-demand environment, the lackluster Class 8 order trend that started in late 2015 continued into 2016,” Vieth said.
For the month of January, Vieth continued, 36,400 Classes 5-8 vehicle orders were booked. That was the third lowest volume of the past 8 months. The slow but steady trend that has been in evidence for the past several years continued with January’s medium-duty orders. While down 19 percent from December’s above-trend order volume, January’s Classes 5-7 net orders rose nearly 3 percent compared to a year-ago to 18,200 units.
“As January is not typically a strong order month, seasonal adjustment boosts the month’s order volume to 19,200 units, a decline of only 10 percent from December and almost exactly in-line with the 12-month order average of 19,300 units/month,” said Vieth.
Meanwhile, Jonathan Starks, chief operating officer at FTR, said his company released preliminary data this week showing last month’s Class 8 truck net orders slipping back to 18,062 units — also down 35 percent month over month and 48 percent year over year.
He said net Class 8 orders for five of the last eight months were below 20,000 with a monthly average for the period of 21,200 units. Since September, order activity has been unusually volatile with the minimum monthly swing more than 6,500 units. January Class 8 order annualized to 217,000 units.
“Orders in 2014 equaled a strong 376,000, 2015 was down from that to just 284,000 orders and now 2016 is starting off even weaker,” Starks said. “It is not looking to be a strong year.
“However, the fundamentals for freight and demand for truck services should hold up well enough to keep the market at replacement levels. In order to see that occur we would expect to see orders improve as we get into the spring months and fleets finalize their plans for 2016 expenditures.”