Class 8 retail truck sales in January reached 19,229 units, which represents a 5.3% increase compared to January 2005, according to www.WardsAuto.com. This is consistent with expectations of heavy truck OEMs, which have generally anticipated truck sales in 2006 will be stronger than 2005.
Despite the modest increase compared with the same month last year, this also represents a 21.5% decrease compared with the month earlier. However, this is a seasonal decline that was anticipated by OEMs, experts say.
“In terms of year-over-year sales, January 2006 continues to reflect the strong economy, strong freight demand and the push fleets have been making to reduce the average age of their fleets,” Scott Kress, senior vp- sales & marketing for Volvo Trucks North America told FleetOwner.
As a seasonally adjusted annualized rate, Chris Brady, president of Commercial Motor Vehicle Consulting (CMVC), told FleetOwner, the January sales rate would mean 282,500 Class 8’s will be sold in 2006. This would be higher than the 252,792 units sold in 2005 according to WardsAuto.com.
“I think what you have is carriers responding to tight capacity and they’re trying to add capacity to meet freight volumes,” Brady said. “[Pre-buying trucks ahead of the ’07 engine regulations] will be much more of a factor in the second half as compared to the first half.”
But even if pre-buying were not a factor, the economic fundamentals of 2006 support a very strong year.
“Volvo's forecast for 2006 is for North American retail sales of 330,000 to 340,000 trucks, up from 320,000 in 2005,” said Volvo’s Kress.
“Orders are going to packed [for 2006] and production slots will likely be filled by the end of April,” CMVC’s Brady said. “[OEMs will] build as much as they can within reason but their constraint is how well their supplier base can meet demand.”
“We prefer not to discuss when we might sell out for competitive reasons, but 2006 is definitely an unusual year in terms of order demand,” Volvo’s Kress said. “We expect that there will be unmet demand among Class 8 customers industry-wide this year for new trucks.”