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Volvo truck production Photo: Sean Kilcarr

Class 8 order surge is 12 months old

For the eighth straight month, Class 8 orders surpassed 40,000 units in North America.

One year after Class 8 truck orders started to surge, preliminary North American order data for October surpassed 40,000 units for the eighth month in a row, according to two research firms that track orders.

FTR reports preliminary North American Class 8 orders for October at 43,000 units and ACT Research reports the number at 43,600 units.  FTR notes that this is the eighth straight month that Class 8 orders surpassed 40,000 units. October 2018 orders were the 10th best on record, according to FTR — 2% above a strong September and 19% better than a year ago. ACT’s October Class 8 orders are up 1.9% from September, which is 21% more than the 2017 October numbers.

“October marks the one-year anniversary of the beginning of the current cyclical surge for Class 8 orders, making year-over-year comparisons narrow appreciably,” said Kenny Vieth, ACT’s president and senior analyst. “Through year-to-date October, Class 8 orders totaled 440,700 units. In the 12 months ending October, a 12-month record 510,900 units have been booked. In 2018, October had the third strongest order seasonal factor. As such, actual data receives a substantial haircut when seasonally adjusted. On that basis, October’s order intake drops to 37,800 units, down 26% from September.”

FTR puts North American Class 8 orders for the past 12 months at 504,000 units.

“October is traditionally the start of the next year’s order season, so to see strong numbers now is not surprising,” said Don Ake, FTR vice president of commercial vehicles. “But ordering for 2019 began in July with back-to-back record months. For orders to still be this hefty in October after that is remarkable.

Fleets continue to order a record number of trucks to secure remaining build slots in 2019. Freight volumes are now expected to be healthy well into the second half of 2019, according to FTR forecasts, keeping capacity utilization at extremely tight levels for an extended period.

“Fleets want to make sure they have access to new trucks, as the growing economy continues to stretch capacity,” Ake said. “They continue to place a record number of orders to ensure they will have the trucks needed if freight levels keep growing.

“Months exceeding 40,000 Class 8 trucks had been a rare occurrence, only happening five times before 2018. However, October is the eighth month of forty-plus orders this year. Activity may start to fall off soon, as available build slots in 2019 diminish.”

Medium-duty orders dipped slightly below the short- and long-run averages, according to ACT.

“Over the course of the past 6 and 12 months, orders have averaged 24.0k and 24.9k, respectively,” Vieth said. “October’s preliminary NA Classes 5-7 net orders were up 19% y/y, but down 4.9% m/m. October is typically a strong month for medium duty orders, so season adjustment drops the month’s intake to an 11-month low 22.1k units.”

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