Trailer Orders Soft, Used Truck Sales up 8 Percent

COLUMBUS, IN — June used truck sales showed an 8 percent increase over May, reported ACT Research today, but lagged behind June 2011 as well as the first six months of 2011.

Pricing looks to be slowing a little quicker than initially expected, ACT said.

“While June’s sales appear positive at face value, concerns are now surfacing, especially relative to the amount of inventory on hand and the prices at which
those units were acquired,” said Steve Tam, vice president, commercial vehicle sector with ACT.

“The slowdown is not necessarily permanent, nor irreversible,” Tam said on pricing, “but is a reflection of current economic conditions. Flat demand for more units started the ball rolling. Higher prices have led to changes in financing, which are making transactions more expensive and preventing some potential buyers from making purchases. The solution lies in increased economic activity, which is expected, but at a measured pace.”

Trailer Orders Fall

The softness in trailer industry orders continued in June, said ACT, adding that it’s a further reflection of the recent soft patch in commercial vehicle demand.

Despite the decline from May, order volume was up almost 4 percent year-over-year.

“Total production grew 3 percent for the month, but jumped 8 percent on a per day basis, as June schedules had one less workday than May,” said Frank Maly, director-CV Transportation with ACT Research.

“Soft orders combined with increased production to shrink industry backlogs by 7 percent during June. The industry ended
the month with backlogs of just over 104k units. The industry typically works off backlog throughout the late spring and summer months, so that decline was anticipated,” he added.