GREENSBORO, NC. A sustained surge in Class 8 orders this year, alongside projected growth in the long-haul sector of the trucking market, has the executives at Volvo Trucks North America (VTNA) thinking the OEM’s overhaul of its VNL tractor family – especially the addition of a 70-in. sleeper model – could not have come at a better time.
“The timing is very good; our products were aging and it showed. But now we are very well suited to benefit from a stronger market,” Magnus Koeck, VTNA’s vice president of marketing and brand management, explained to Fleet Owner here at a VNL ride and drive event at the OEM’s U.S. headquarters.
He said its “pretty clear” that 2017 is turning out to be a better year than previously thought in terms of truck sales, with VTNA predicting Class 8 production for North America Free Trade Agreement (NAFTA) region will top 225,000 units this year; volumes which should only strengthen heading into 2018.
Some of positive trends Koeck highlighted that will help boost commercial truck sales growth overall this year and next include:
- A stronger labor market and increased consumer spending that is driving GDP [gross domestic product] growth in the U.S – growth that hit 3% in the second quarter this year;
- A manufacturing sector that is “rebounding” this year, with “moderate growth” expected in 2018;
- Construction spending, which is currently at an all-time high, that will continue to experience a “gradual” increase;
- Diesel fuel prices that will remain relatively low, with the Energy Information Administration (EIA) at the moment projecting diesel to end 2017 averaging $2.66 per gallon before climbing to $2.81 per gallon for 2018.
While Class 8 registrations slipped in U.S. & Canada overall in a year-to-year comparison, with the long-haul sector experiencing a decided dip in 2017, Koeck believes that trend will start reversing next year.
Year-to-date Class 8 registrations hit 100,468 units in June this year, according to IHS Automotive data, down from 119,618 units year-to-date in June of 2016, with the long haul segment contracting to 41.5% of those registrations in 2017 compared to 46% in 2016.
Yet Koeck believes that long-haul will return to 45% or so of Class 8 registrations in 2018 as freight volumes continue to strengthen.
“The long-haul sector will come back strong and the regional haul sector will strengthen as well,” he said.
Koeck also noted that the revamped VNL long-haul family will fully replace its “legacy” VNL models by early next year, with the legacy VNL 670 the only model to remain “in the mix” into the first quarter of 2018.