Class 8 Production to Take a Dip: Analysts

NASHVILLE, IN — Class 8 truck production is expected to significantly drop in the second half of 2012, Freight Transportation Research (FTR) Associates predict. While 2012 is expected to have a 3.4 percent growth, 2013 is expected to have an 11 percent decline.

The predicted slowdown is pinned to the state of the U.S. economy and decline in freight growth that resulted with fleets pulling back on Class 8 orders to a level much lower than current Original Equipment Manufacturer (OEM) build rates.

“OEM’s continue to manufacture trucks at a rate unsustainable, in our view, based on the U.S. economic environment and the current Class 8 order activity,” said Eric Starks, president of FTR. “In light of this, as well as our less than positive view of the economy, we have significantly reduced our forecasts. Production levels for 2013 may be reduced further if there is no adjustment made to near-term build rates. The economy is just not performing well enough to generate greater demand for new vehicles and unless there is a marked change, we expect softer demand for Class 8 vehicles at least through next year.”

FTR is concerned about the oversupply of new inventory on the market which will only continue to get worse if OEM’s continue to build at current levels.

But retail levels in 2013 are expected to match those of 2012 which means that demand in the equipment market is healthy, even though it is not growing.

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