Year 2020 has been a year of dealing with uncertainty and adapting to the current environment. Every class of retail sales in the industry saw year over year downfall, likely due to the COVID-19 outbreak. However, Class 8 market took the most noticeable drop at more than 60% decline in May 2020 compared to last May 2019. New norms have sent businesses on new paths, but some in search of more efficiency, better planning, working more lean budgets and creative strategies to deal with the uncertainties.
The ongoing pandemic is keeping anxiety at high levels for near-future goals, but some analysts are suggesting that commercial vehicle markets will bounce-back strong. Even though OEMs are still balancing production with placed orders, there are indications that market improvements will continue to be visible.High order numbers in August were a surprise, but very welcome. The positive boost leads analysts to believe the industry is recovering from the pandemic more quickly. However, this turn-around has been happening while supplemental income programs were in place by the government. Consumer spending has been keeping the supply chain busy. As those programs have been expiring, will we see a change back to feelings of more uncertainty and weaker consumer spending thus affecting the economy?
Some notable points:
- With continued increases in Classes 5-7 builds, the OEMs seem to be betting on business and consumer resilience since freight markets continue to be less impacted by the COVID-19 pandemic than the economy at large
- Used Class 8 volumes (same dealer sales) grew 16% month-over-month in July
- In July 2020, preliminary North American Class 8 orders were up 28% — 20,000 units, compared to June’s 14,400, and its output doubled from July 2019.
- Class 8 net orders are expected to stay in the 20k range for a few months, as the economy recovers.
- Preliminary U.S. net trailer orders for August jumped 49% m/m to 28,700 units, the strongest activity since last October