FTR: Class 8 orders stabilize after 4-month decline

Net orders for North American Class 8 trucks in May grew 4 percent from April, but were still down 30 percent compared with May 2015, according to preliminary data from freight forecaster FTR Transportation Intelligence.    Net orders for North American Class 8 trucks totaled 14,100 units in May, a 4 percent increase from the prior month, according to preliminary data from the freight forecaster FTR Transportation Intelligence.
   Class 8 truck orders in April fell for the fourth straight month.
   However, FTR noted Class 8 orders for the month were still down 30 percent compared with May 2015 and the lowest level for the month since 2010.
   Orders have come in at an annualized rate of 175,000 units over the past three-month period and the annualized rate for the past twelve months continues to fall, now at 231,000 units.
   Don Ake, vice president of Commercial Vehicles at FTR, said the “soft” order activity in May was expected leading up to the traditional slower summer season.
   “The good news is that they did not fall further from April, but some erosion in order activity is expected during the slow summer months,” said Ake. “Fleets do not need to order many trucks in the current environment because in most cases they have enough trucks to handle the freight. Freight demand is still sluggish due to the build-up of business inventories.”
   “Dealer inventories of Class 8 trucks remain bloated, so the only truck orders now are mainly for replacement purposes, with preferred specifications,” he added. “Backlogs will continue to fall, they are now below 2014 levels for May.
   “It will be a challenge for the OEMs to schedule production through the summer. Extended vacation shutdowns are anticipated.”