Truck sales up...for now

Truck sales up...for now

Retail sales of Class 8 trucks topped off at 23,499 units in September and 209,938 for the first nine months of 2006, according to WardsAuto.com.

Retail sales of Class 8 trucks topped off at 23,499 units in September and 209,938 for the first nine months of 2006, according to WardsAuto.com. This marked a sizable increase compared to the same period last year, 21,677 and 186,439 units respectively.

According to Commercial Motor Vehicle Consulting president Chris Brady, the September data translates to a seasonally adjusted annualized rate of 283,130. This indicates September sales received a boost compared to the first nine months of 2006, which had a rate of 281,532.

Trucking operations are now accelerating purchases of 2006 model year trucks and older to avoid buying 2007 and later models, which will carry heftier sticker prices because of new emissions reduction technologies to meet new EPA clean air requirements. This will keep retail sales in the second half of 2006 higher than the first half, Brady explained.

In spite of the strong month, it appears that dealers are receiving more trucks than they are selling. In September retail truck sales increased 8.4% compared to September 2005 but inventories inflated by 17% from 44,891 units to 52,675.

If dealer inventories aren’t drawn down soon, it could mean OEMs will experience a larger than expected downturn in 2007. “What high inventory numbers [in ‘06] do is impact production negatively for truck makers in ’07,” Brady explained. “If dealers have too many trucks on their lots, they’ll try to clear out their inventory before placing new orders.”

To comment on this article, write to Terrence Nguyen at [email protected]

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