CEOs speaking at the Mid-America Trucking Show last week were universally upbeat about the year ahead. Strong Class 8 truck demand is expected to continue through 2015, with production climbing 15-20% over 2014’s healthy volumes, according to Joe McAleese, chairman, president and CEO of Bendix. However, he also predicted this year will mark the cyclical market peak, with a drop of 5-15% to follow in 2016.
“So we will not have a dramatic drop, just a little softening,” he said during his press address.
Every economic indicator Bendix looks to for hints of future Class 8 truck demand are currently in positive territory.
The pullback Joe projects for 2016 is based on the fact 2014 orders finished the year strong, putting pressure on truck production.
Despite his upbeat market outlook, he said there are three things keeping him awake at night. These include: the worsening driver shortage, with no end in sight; the impact regulatory changes will have on fleet operating costs and the acquisition costs of new vehicles; and the slow pace of the industry’s acceptance of new safety technologies.
Still, Joe concluded, “2014 was one heckuva year and 2015 is shaping up to be more of the same.”
Preston Feight, Kenworth general manager, suggested 2015 could be the second best year on record for Class 8 orders.
Daimler Trucks North America CEO Martin Daum, speaking to truck journalists at a roundtable event, predicted NAFTA Classes 6-8 truck demand will grow about 10% this year. This means between 411,000 and 453,000 new vehicles could be required.
However, he acknowledged there’s a lot of uncertainty in the Canadian market, due to the poor exchange rate and the slowdown in the oil and gas market.
To meet the anticipated demand, Daimler has increased production by 16%, and is still in the process of training and deploying 2,300 additional workers since last summer. The company is planning to build 27,000 more trucks this year.
“I have absolutely no fear those production slots will go empty,” the Daimler boss said. “In fact, I have a feeling it might not be enough and we might do some more.”
James Menzies is editor of Truck News magazine. He has been covering the Canadian trucking industry for more than 15 years and holds a CDL. Reach him at firstname.lastname@example.org or follow him on Twitter at @JamesMenzies. All posts by James Menzies