Kenworth remains optimistic about truck market
CHILLICOTHE, Ohio — Class 8 truck orders have fallen sharply in the early months of 2016, but Kurt Swihart, director of marketing for Kenworth, is maintaining an optimistic view.
Speaking to trade press journalists today, Swihart said Kenworth predicts Canada/US Class 8 retail sales to total between 220,000 and 250,000 units this year. That’s down from about 280,000 last year, but Swihart pointed out this year is still likely to be the third best year in the past decade.
“It’s still a very healthy market, a very good market for the truck industry,” he said.
Swihart gave a number of reasons why he thinks demand for new trucks will remain healthy, including an uptick in US for-hire truck tonnage, the return of manufacturing activity to positive territory and strong housing and construction activity.
There has also been lots of road and commercial construction in the US, driving demand for vocational trucks.
“Anecdotally, we hear stories from dealers saying it’s difficult for them to keep stock dump trucks on their lots,” Swihart related. “As soon as they get T880 dump trucks in stock, they’re able to sell those.”
And with oil prices on the rise, Swihart said he’s anticipating the return of demand in the oil and gas industry.
“There are a lot of good indicators out in the market and we feel this year is off to a good start and that 2016 will be a very good year for Kenworth,” Swihart predicted.
The Chillicothe truck plant, where Kenworth T680s and T880s are built, has been busy, producing 128 trucks a day. The day shift is running at capacity while the second shift is running at about half of capacity. Judy McTigue, plant manager, said Kenworth reacted quickly to softening market conditions, which allowed it to adjust its staffing levels in accordance with demand. That has kept things steady so far this year.
There’s also a major construction project underway at the plant. A new 25,000 sq.-ft. parts management system and automated storage facility is being built on top of the existing plant, at a cost of US$17 million. Currently, Kenworth stores painted cabs and hoods outside in the elements, but the new storage facility will allow it to free up outside space while keeping painted components protected from the elements.
“Painted product will never go outside anymore,” McTigue said. The new facility is expected to be up and running by November.
Swihart said these are exciting times for Kenworth, which is riding the popularity of its new flagship T680 and T880 models. Those two trucks now comprise 90% of Kenworth truck production in Chillicothe.
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