Posted on 05/08/2016 6:33:17 PM PDT by fella
First, let’s take a look at the reports, then we will take a look at what this may mean for the economy.
Class 8 Truck Orders Plunge 39%
The Wall Street Journal reports Truck Orders Fall in April.
Last month, trucking fleets ordered just 13,500 Class 8 trucks, the big rigs used on long-haul routes, down 16% from March and 39% from a year earlier. It was the fewest net orders in any April since 2009, FTR said.
DAT Solutions, an Oregon-based transportation data firm, reported that loads available for dry vans, the most common type of tractor-trailers used for shipping consumer goods, fell 28% in April while capacity on the market was up 1.7% on a year-over-year basis.
Eaton Corp. , the sales leader in heavy-duty truck transmissions, predicted that organic sales from its vehicles unit will fall 10%-12%, after earlier predicting that sales would drop 7% to 9%. The company lowered its outlook for the business after concluding there are at least 20,000 heavy-duty trucks built last year that are still sitting on dealer lots.
Engine maker Cummins Inc. said on Tuesday it doesn’t expect any improvement in the truck market later in the year. It now expects heavy-duty truck production in North America to be at 210,000 vehicles this year, down 5% from its earlier view and down 28% from 2015’s actual volume. Cummins’ first-quarter sales of diesel engines to the heavy-duty truck market dropped 17% from a year earlier to $631 million.
Worst Yet to Come
CCJ reports Sagging truck orders ‘will probably get worse before it gets better’.
Last month was the worst April for Class 8 truck orders since 2009 according to preliminary data released by FTR Wednesday.
North American Class 8 truck net orders fell for the fourth consecutive month in April to 13,500 units, down 16 percent month-over-month and 39 percent year-over-year.
Don Ake, FTR’s vice president of commercial vehicles, says “surprisingly low” orders across the board were weak as the Class 8 market tries to find the bottom of this cycle.
Kenny Vieth, president and senior analyst for ACT Research, says the blame for low orders was widespread.
” … an ongoing overcapacity narrative, a resulting weak freight rate environment, softness in late-model used truck values, and excessive new vehicle stocks,” he adds.
Large Truck Sales vs. Recessions
Variant Perception reports Peak in Heavy Truck Sales Point to Cyclical Pain.
Heavy truck sales are oddly a good leading indicator for the economy. It is odd because a lot of industrial production is coincident with the business cycle. However, if you go back over forty years, you can see that recessions have always been preceded by a decline in heavy truck sales. This is particularly true if the increase in truck sales is very large. Today, truck sales are not far from where they were at previous cyclical peaks in 1999 and 2007.
Orders are down, sales will follow, sharply!
So many people posting about trucks. This thread is not about truck sales. It is about our economic health and what plummeting truck sales indicate. As an indicator, it means shipping has been way down and fleets are lasting longer because they are handling a reduced number of goods. It shows a gradual decline in overall economic activity.
There is no recovery. We have been in one very long but well masked recession deceptively hidden with creative accounting and government money printing.
I didn’t think this went through because when I posted it I got a blank screen.
Only in ObaDinga's mind !
We're in a recovery - read the newspapers, and the media !! FUBO !
Everyone is hold out for the new Tesla rig coming soon. The hybrid version just like the diesel electric train engines made by GE. Made in partnership with Snecma S.A. is a French multinational aircraft and rocket engine manufacturer headquartered in Courcouronnes, France.
Just retired out of Peterbilt we called them kits. Chassis and cab without engine and transmission, most have axles but some don’t have drive axles.
There’s an outfit that buys a bunch of them and puts Detroit engines in them. The rumor was that Detroit is the only engine that doesn’t require DPF.
Obama and co have reached the end of their economic bag of tricks.
He’s setting us up for a world wide depression for next year. Of course after that comes war.
Makes you part of the 71 percenters:)
“There is no recovery. We have been in one very long but well masked recession deceptively hidden.......”
Absolutely.
Significant.
My contact lens company is going again through the same trouble it had in 2008. Disposable Contact lenses are a good indicator of Middle Class ease in wealth. They are like canaries in the coal mine type products.
We have been told to scale back our production because our sales force has not been able to keep up, and this is not just because of lost market share. In 2008 they fired brutally a bunch of people that were valuable knowledge and they vowed not to do that. again, so we only are being reassigned.
This is not good, this came as a surpirsed after weeks of being admonished to maximize production and time efficiency on machines. There might be something else coming.
Yellen and Fed Reserve games have been done solely to bail out the Obamaeconomy. China is supporting hismpresidency,mitmis obvious, by financing our low interest rates.
Glad I got LASIK years ago.
I was too dependent on contacts.
“He’s setting us up for a world wide depression for next year.”
Some would argue that it’s already here.
“Of course after that comes war.”
Absoluty.
Well spec’d used trucks that are pre-EGR, DPF, DEF bring a good price at auction. Some buyers are happy to avoid all the emissions technology in newer trucks which translates into more downtime and higher maintenance costs.
From the Denton plant?
They make a “convertible”. It comes as a 9 speed spec’d for company fleets. Then when the trucks is ready to be remarketed to Owner Operators, they convert it to the 13 spd. O/O’s just like more gears :-)
Texas has one called TERP.
Texas calls their program TERP. http://www.tceq.state.tx.us/airquality/terp/rebate.html
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.