Preliminary Class 8 net orders are see January declines

Preliminary January North American Class 8 net truck orders saw declines, according to recent data respectively issued by freight transportation consultancy FTR and ACT Research, a provider of data and analysis for trucks and other commercial vehicles.

FTR reported that preliminary January North American Class 8 net orders—at 21,400—were off 8%, from December to January and off 50% annually. For the last 12 months, FTR said Class 8 orders came in at 343,000.

FTR said that January orders continued to track in a restricted range with the total for the month equaling the average of the last four months. And it added that OEMs continue to match order rates to build rates as they manage backlogs monthly and that OEMs are not entering all their 2022 commitments because they do not want to overbook due to the uncertain supply chain.
“January orders met expectations. As a group, the OEMs are entering orders at the same rate as production,” said Don Ake, vice president of commercial vehicles for FTR, in a statement. “Backlogs have tracked in a narrow range for the last ten months, which is odd in this cyclical industry. Normally, this would indicate a very stable market. In this case, it reflects a market frozen by a weak supply chain. There is still tremendous demand for new trucks. The order totals for the last twelve months, at 343,000 units, would equate to a robust production year. The orders are there but the OEMs continue to be limited in what they can produce due to shortages of semiconductors and other components. The big negative to the January order volume is that it indicates the supply chain has not improved yet from the end of last year. OEMs are not confident they can get parts, so they limit the number of orders they enter. Order totals will rise as soon as supply chain conditions improve.”

ACT data:ACT reported that January preliminary Class 8 net orders—at 21,300 units—trailed December’s preliminary tally, which came in at 22,800.

“Constrained production capabilities and long backlogs continue to hamper new order activity. Order weakness continues to be primarily, if not entirely, due to supply-side shortages that continue to restrict production,” said Kenny Vieth, ACT President and Senior Analyst, in a statement. “As has been the case for months, we reiterate that with critical economic and industry demand drivers at, or near, record levels, industry strength should be measured by long backlog lead times, rather than tepid new order activity. For Class 8, with backlogs stretching through 2022 and still no clear visibility on the easing of the everything shortage, January’s net order haul reflects the ongoing conservative approach by OEMs looking to limit the risk of overbooking and underbuilding that plagued the industry in 2021.”