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Class 8 Truck Orders Plunge 39%; Large Truck Sales vs. Recessions
fxstreet ^ | 6 May 2016 | Mike Misch Shedlock

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!


TOPICS: Business/Economy
KEYWORDS: economy; freight; trucking
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Here comes that fundamental change that the jack asses have been braying about.
1 posted on 05/08/2016 6:33:17 PM PDT by fella
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To: fella

wow those numbers are actually pretty bad


2 posted on 05/08/2016 6:35:25 PM PDT by ghosthost
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To: ghosthost

“...wow those numbers are actually pretty bad...”

So is the government that caused them.


3 posted on 05/08/2016 6:42:49 PM PDT by EagleUSA
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To: fella

We have 26 new daycab Peterbilts arriving in 2 weeks.


4 posted on 05/08/2016 6:42:50 PM PDT by MountainDad (Support your local Militia)
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To: fella

The jackasses braying are sitting pretty, so far, in their ivory towers. Unfortunately for them, this time the people may not just put head down and weather the storms like good little peasants. Visions of 1789 ought to haunt their dreams, every single moment of every single night.


5 posted on 05/08/2016 6:44:08 PM PDT by Thumper1960 (Trump-2016)
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To: fella

What are those kits called where they rebuild a truck?


6 posted on 05/08/2016 6:46:09 PM PDT by headstamp 2 (Fear is the mind killer.)
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To: ghosthost

The reason Eaton gear (the tranny company) isn’t doing so bad is that they are selling a sh*tload of upgrades for your typical 9spd manual tranny’s to turn them into 13spd semi-auto tranny’s ... increases fuel economy by about 0.4mpg (5% or so) ...


7 posted on 05/08/2016 6:47:01 PM PDT by oscar_diggs
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To: fella
This represents a larger hit to our once-robust economy than one might suspect.

Not only the truck mfgs, but their suppliers might need to lay off workers. And, the trickle-down effects do not stop there.

The "multiplier" effects can become "divisor" effects in rapid order, and yes, a lowering tide sinks all boats.

Sad to be so negative, I would rather be celebrating a healthy economy.

.

8 posted on 05/08/2016 6:49:09 PM PDT by Seaplaner (Never give in. Never give in. Never...except for convictions of honour and good sense. W. Churchill)
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To: MountainDad

I drove an ‘84 Petercar daycab not long after I first learned to operate a big rig back in 87 or 88. Champaign to Chicago suburbs and back and occasionally from Champaign to Kansas City or Denver. No fun sleeping across the seats in that baby but she had power and I used it on occasion to get a speeding tickie or two those days.


9 posted on 05/08/2016 6:49:35 PM PDT by CARTOUCHE (My mother was a saint. For all she endured she will remain as such.)
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To: headstamp 2

Glider


10 posted on 05/08/2016 6:52:29 PM PDT by showme_the_Glory ((ILLEGAL: prohibited by law. ALIEN: Owing political allegiance to another country or government))
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To: EagleUSA
“...wow those numbers are actually pretty bad...”

So is the government that caused them.

The Obamaconomy created by the worst and first black president in U.S. history.

11 posted on 05/08/2016 6:56:14 PM PDT by jsanders2001
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To: showme_the_Glory

That’s it, thanks.

Wonder how many of those are selling verses buying new trucks.

I remember reading that the Feds were clamping down on those too as far as emissions.


12 posted on 05/08/2016 6:56:21 PM PDT by headstamp 2 (Fear is the mind killer.)
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To: fella

“...fundamental change....”

WTF

IMHO


13 posted on 05/08/2016 6:56:44 PM PDT by ripley
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To: showme_the_Glory

Some of this may come from glider rebuilds because tier 4 trucks are so plagued with reliability issues, but on another forum I frequent heavy diesel mechanics are saying how business has flatlined and they are staring at the walls.


14 posted on 05/08/2016 6:57:43 PM PDT by VTenigma (The Democratic party is the party of the mathematically challenged)
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To: headstamp 2

Glider kits


15 posted on 05/08/2016 7:04:25 PM PDT by MountainDad (Support your local Militia)
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To: fella

Is any of this related to the fact that self driving trucks, at least ones that can train behind human driven trucks , are on the horizon? Why buy an obsolete model of a long term asset?


16 posted on 05/08/2016 7:11:02 PM PDT by Vince Ferrer
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To: fella

About 6 years ago they accelerated purchases in order to avoid the initial pain of SCR engines, these cycles work both ways.


17 posted on 05/08/2016 7:13:38 PM PDT by bigbob
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To: fella

Like almost everything, trucks are getting more and more expensive. People will try to make what they have last longer. We need a cash for clunkers program for big rigs.


18 posted on 05/08/2016 7:16:15 PM PDT by smokingfrog ( sleep with one eye open (<o> ---)
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To: fella

I’m just not lucky enough to buy a new heavy tandem truck.


19 posted on 05/08/2016 7:16:42 PM PDT by Recompennation
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To: fella
"Heavy truck sales are oddly a good leading indicator for the economy."

It's odd only if you are a moron who does not understand the economy and how goods are actually shipped. (Obviously not directed at you, FRiend fella.)

Another big indicator is the rail industry. In that regard, see here.

20 posted on 05/08/2016 7:19:30 PM PDT by piytar (http://www.truthrevolt.org/videos/bill-whittle-number-one-bullete)
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