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Class 8 net orders below trend in July, Class 5-7 bounce back: reports

NASHVILLE and COLUMBUS, Ind. -- FTR Associates has released preliminary data showing July Class 8 truck net orders at 12,568 units, the lowest month for orders since August 2010 and 32% below the same month last year. Preliminary order numbers...


NASHVILLE and COLUMBUS, Ind. — FTR Associates has released preliminary data showing July Class 8 truck net orders at 12,568 units, the lowest month for orders since August 2010 and 32% below the same month last year. Preliminary order numbers are for all major North American OEMs. July orders came in 23% below weak June activity and continue reflecting soft demand for Class 8 vehicles, FTR officials said.  For the three-month period including July, orders now annualize to 186,300 units.

“While orders came in below expectations, they didn’t really surprise us,” said Eric Starks, president of FTR. “ We have been forecasting slower sales of Class 8 vehicles in the second half of 2012 for some time, and the reported order numbers for July support our current outlook for the remainder of the year.”

ACT Research has also reported that Class 8 commercial vehicle preliminary net orders for July were below trend, while Classes 5-7 net orders bounced back above the long run order trend. The final numbers, which will be released by ACT in mid-August, will approach 12,900 units for heavy-duty Class 8 trucks and 14,800 for medium duty Classes 5-7 vehicles. The preliminary net order numbers are typically accurate to within 5% of actual.

“Class 8: orders fell below our near-term expectations, even when adjusted for seasonality,” said Kenny Vieth, president and senior analyst at ACT Research. “Seasonal adjustment pushes July’s Class 8 net orders total from the actual 12,900 units to 15,400 units. In Q2, net orders averaged 17,300 units per month, even as Class 8 builds averaged 26,000 units. As has been the case since late February/early March, the order weakness appears to boil down to confidence in the economy relative to the risk of taking out a sizeable loan to buy a truck.

“Positively, Class 8 cancellations remained at low levels and retail sales were strong through Q2, reflecting the continued support of large trucking concerns. The big public carriers posted strong profits on modest revenue growth in Q2. These data points and others suggest that as the economy firms and the outlook becomes less opaque, demand should return to pre-soft-patch levels.”


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