U.S. economy, freight markets have room to run: ACT
There is considerable steam left in the boiler that will continue to propel the economy broadly, and freight markets specifically.
That’s the message industry forecaster ACT Research gave in its North American Commercial Vehicle Outlook.
“The sugar rush of stimulus money began rolling-off at an increasing pace in June, and with extended unemployment benefits being curtailed in roughly half the U.S., employment numbers, including new jobs in trucking, jumped,” said Kenny Vieth, ACT’s president and senior analyst.
“As U.S. industry shakes off the rust and capacity comes back on line, we are reminded of the old chestnut, ‘the cure for high prices is high prices.’ With prices for many commodities reaching new records in 2021, there is a great desire to bring new capacity on line to take advantage of the bonanza.”
Vieth added, “While there are signs of moderation, and the economy is closer to reaching the ‘end of the beginning’ of this year-old up-cycle, the ‘beginning of the end’ is not yet on the radar.”
As for commercial vehicle demand, Vieth said: “Medium-duty, heavy-duty and trailer backlogs are essentially filled through 2021 and into 2022, with backlog-to-build ratios well above traditional ranges. Class 8 and trailer orders remain constrained on limited calendar-year 2022 build slot access, and with demand hot and production constrained, inventories have narrowed considerably.”
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This shortage of trucks trailers and drivers could have been prevented if in Ontario in January of 2020 the Ford gov had have the Federal gov to work with them to cover the insurance for all fleets can under 200 truck affected by the slowdown instead of wage subsidy to companies that cash reserves or a profit of over 2 million dollars in 2020. Also if the gov and the industry put together a plan to look after sick and injured truck drivers and paid for all hours worked except time in the sleeper with overtime .We would have a surplus of new drivers of the Ont gov provided insurance for new truck drivers and fleets under 100 power units be bus , taxi , wheelchair accessible vans or trucks.