RESEARCH TRIANGLE PARK, N.C. – Heavy-Duty Manufacturers Association (HDMA) members responding to a September Pulse Survey said they expect their U.S. and Canada commercial vehicle business to be down an average of 27% compared to 2019.
“Our sector is not one of the ones hardest hit over the course of 2020,” said Richard Anderson, director, market research and analysis for HDMA when speaking during a recent webinar. “Trucking has shown itself to be one of the true essential industries in our nation.”
But that doesn’t mean trucking industry suppliers were immune from the economic pain wrought by the Covid-19 pandemic. HDMA respondents are expecting their 2021 commercial vehicle business plans to be down 10% from pre-Covid 2019 levels.
Andrej Divis, director, global truck research with IHS Markit, said his firm has reduced its outlook for global GDP growth to -5% in 2020.
“We are expecting to see a sharp rebound in 2021 of about 4%,” he added. “Compared to an earlier review from a few months ago, almost every region’s outlook has gotten worse.”
But North America stands out globally as a bright spot, Divis added. He projected U.S. GDP to fall -4% to -4.8% in 2020, “Better than we thought it would be.”
The North American commercial vehicle market has snapped back faster and more strongly than expected, Divis said, with the upturn coming in May to July rather than the previously expected timeline of August-September.
Commercial vehicle demand is being driven by specific sectors, including e-commerce and construction. Housing starts are now expected to end the year flat, or slightly above 2019 levels.
Those segments have translated into strengthening demand for medium-duty vehicles. Divis noted Classes 4-7 demand is outpacing that of Class 8 trucks, and within the medium-duty segment, Class 5 is seeing the strongest demand. Class 5 is the only segment that now exceeds pre-Covid demand levels, Divis said.
Some of that activity, however, may have run its course, Divis said, noting Class 5 demand may slow while Classes 4, 6, and 7 should experience growth in 2021.
Overall, Divis said 2021 should be a positive year for the commercial vehicle market, “with some caveats.” For example, it’s possible demand is being driven by restocking of inventories, which could slow in the fourth quarter. Divis believes 2020 represented the trough for commercial vehicle demand, that 2021 will be better, but still below 2019 levels.
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