COLUMBUS, Ind. – The main risk facing the North American commercial vehicle market and the economy is the trade war with China, while the consumer remains the key driver of the economy.
That’s from ACT Research and its North American Commercial Vehicle Outlook, which also concluded the U.S. consumer is well positioned to keep the economy “out of the ditch.”
“With around 80% of North America’s Class 8 market and about 90% of the Classes 5-7 and trailer markets beholden to the U.S. economy, it is little wonder that ACT’s forecasts focus heavily on the North American, and primarily the U.S., economy,” said Steve Tam, ACT’s vice-president. “We are seeing weaker-than-expected activity in the economies of Canada and Mexico and our U.S. growth expectations, at 2.2%, are now below start-of-the-year levels. Looking to 2020, GDP growth in all three North American economies is anticipated to fall below 2%, with the U.S. and Canada at 1.7% and Mexico rebounding to 1.4%.”
Regarding the trade war and risk of a recession, Tam added, “If the President doubles down from here, a greater global downturn could ensue, with the worst outcomes spreading beyond the impact of tariffs and into a global currency war. If Schedule D tariffs are put in place in December, the likelihood of recession rises.”
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