• February Class 8 sales fall 19%

    Class 8 retail sales in February topped out at 16,471 units, according to WardsAuto.com, marking a 19% slide from the same month last year
    March 20, 2007
    2 min read

    Class 8 retail sales in February topped out at 16,471 units, according to WardsAuto.com, marking a 19% slide from the same month last year. The steep decline indicates a cooling of last year’s white-hot truck market, which was heated up by a strong economy and pent-up demand to replace aging trucks.

    The drop in sales reflects a decline in trucking companies pre-buying trucks equipped with ’06 engines to avoid operating the trucks with more expensive ’07 technology.

    “Pre-buy is winding down,” Chris Brady, president of Commercial Motor Vehicle Consulting told FleetOwner. “February retail sales were weaker than January’s because pre-buy was weaker. By the end of March, pre-buy will be about completed.”

    The trucking industry had added fleet capacity as a result of pre-buying. The freight environment in the fourth quarter of 2006 and the first quarter this year was described as having “sluggish growth,” which combined with excess capacity makes retail truck sales poised for further declines in the months ahead.

    Dealerships had an inventory of 54,703 units in February, according to WardsAuto.com. Brady said that this indicates that dealers have stocked up on trucks with ’06 engines in anticipation of relatively sluggish demand for their costlier ’07 counterparts.

    With trucking dealerships carrying plenty of excess inventories, OEMs will weather a severe decline in production compared with retail sales data. This is because dealers must draw down their excess inventories before they order more units from OEMs.

    This is evidenced in truck deliveries, which represent manufactured units being transferred to dealer inventories or customers. Deliveries are different from retail sales, which are initiated by the end-user, not the dealers.

    Today AB Volvo said its Mack, Volvo and Renault brands delivered 41% fewer trucks in North America from January through February compared with the same period last year. The three brands, which comprise AB Volvo’s truck group, totaled 6,382 compared to 10,766 last year.

    Volvo Trucks delivered 3,661 units, a 31% drop compared to the 5,284 units delivered last year. Deliveries from Mack totaled 2,666 units, a 51% plunge from the 5,417 units delivered in the same period last year. Only 55 Renault trucks were delivered, versus 65 during the same period in 2006.

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

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    Terrence Nguyen

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