Class 8 net orders for July were down 1% month-over-month in North America at 26,500 units while orders were more than 25% year-over-year, according to FTR Intel, with Class 8 orders now totaling 394,000 units for the previous 12 months.
The July order total is essentially equal with June, as the industry is in a holding pattern at the bottom of this order cycle. Ordering for 2022 has commenced at most OEMs but remains delayed some due to cost uncertainty and the possibility of enduring supply chain bottlenecks.
“July ordering was similar to June in that OEMs took a limited number of orders for delivery in 2022,” Don Ake, VP of commercial vehicles for FTR commented. “Fleets need a significant number of new trucks right now and they perceive this need will continue throughout next year. However, OEMs are having difficulty establishing reasonable 2022 pricing, with commodity and other costs elevated. It is uncertain if current higher production costs are transitory or will persist into 2022.
“Also complicating the situation is that shortages of semiconductors have limited Class 8 production. It is estimated that supply of trucks is falling approximately 25% behind market demand. We are running out of time for OEMs to catch up. Most of the unproduced orders will roll into the first quarter of 2022. If those months are already booked solid, it creates even more headaches for the industry. Things won’t approach any degree of normalcy for months. Until semiconductors begin flowing into the OEMs in sufficient qualities, we will be playing catch up.”