COLUMBUS, Ind. -- A slumping Class 8 truck market is being chalked up to low confidence among credit-seekers, according to industry analyst ACT Research.
The company says the current environment should support healthier Class 8 orders than have been seen over the past three months.
In its State of the Industry report, ACT president and senior analyst Kenny Vieth said “If the pullback in orders was freight-related, we would have expected to see a run-up in cancellation activity, which has not been the case. This suggests to us that the problems with demand are not systemic.”
Vieth went on to explain: “Smaller truckers who have to borrow to buy are most likely driving older trucks with relatively low values. Those truckers need to borrow $90,000-$100,000 to finance a new truck, but their confidence has been shaken by a number of events in early 2012, including economic concerns, a 9.5% jump in fuel prices through Q1, and inconsistent freight early in the year.”
ACT continues to predict reasonable freight growth, healthy trucker profits and rising used truck prices, which should support stronger Class 8 truck demand once the current period of uncertainty passes.