Class 8 truck orders remained strong in February, with an impressive 44,000 units booked according to preliminary data from FTR.
That was up 3% from January and 209% year-over-year, and marked the second strongest February ever. Orders over the past 12 months total 338,000 units.
“There is tremendous pent-up demand for trucks. There are severe bottlenecks in the supply chain involving computer chips, wiring harnesses, and a whole host of various parts. OEMs are under intense pressure to deliver as many vehicles as they can, as soon as they can,” said Don Ake, vice-president of commercial vehicles for FTR.
“The tight capacity has caused spot rates to spike from already elevated levels. Contract rates are rising also. Therefore, fleets have plenty of cash to spend. They desperately need trucks, so they are ordering at near-record levels.”
Ake added: “The supply chain is so dysfunctional right now and there are so many parts affected, it is difficult to predict when the logjam breaks loose. The vaccine should help component manufacturers find more workers. There are also lengthy waits at the ports causing delays in imported parts.”
ACT Research reported preliminary Class 8 orders of 43,800 units, and Classes 5-7 orders of 25,400 units. Medium-duty orders were down 4% from January but up 12% year-over-year.
“Beyond warmer inflation numbers, there is much to like in the current stream of economic data that indicate broad-based economic activity,” said Kenny Vieth, ACT’s president and senior analyst.
“As has been the case over the course of this pandemic period, economic growth is being driven by the goods-producing sectors of the economy. Consumer spending on goods, a red-hot housing market, a reaccelerating manufacturing sector, and pent-up inventories combine to provide very good visibility to near- to mid-term freight trends. Contract freight rates are at record levels, as are spot rates, after seasonal adjustment. Without injecting stimulus or infrastructure into the discussion, there is a lot to like about freight, the carrier profit outlook, and by extension the commercial vehicle demand landscape.”
Regarding the medium-duty market, Vieth added, “The shift in consumer spending from experiences to goods continues to support providers of local trucking services, as e-commerce has grown by leaps and bounds in the pandemic economy.”