Heavy Truck Market- Update on Forecast

One of the joys of my job is always being on the lookout for great sources of information for the PMPA members.

We Think Heavy Trucks Rule!

Boy did I find a great source of news and  info on the heavy truck market!

www.ftrassociates.com

Here are some factoids from a couple of their most recent news releases posted in their news room on their website:

1) FTR Associates has released preliminary data showing February Class 8 truck total net orders for all major North American OEM’s at 7,628 units, 19.7% higher than January when orders were the lowest since 2002.

Lesson there: January 2010 was lowest Class 8 truck sales volume since 2oo2! February data was still below 2009 average, but we think that for class 8 trucks, this may be the bottom.

2)FTR Associates continues to forecast Class 8 demand for 2010 and 2011 at the same levels as was forecast by the firm one year ago. FTR’s March North American Commercial Truck and Trailer Outlook Report   forecasts 2010 demand for Class 8 vehicles will increase just 3% over 2009. The company projects that this will be followed by considerably more significant improvement of over 50% in 2011.

Analysis: FTR is forecasting only a 3% increase in demand for class 8 trucks in 2010. Last December, we ran a post about the heavy truck market that gave 6 reasons why we were bearish about prospects for heavy truck:

  1. Commercial credit availability is still impaired,
  2. Reduction of debt throughout the economy,
  3. Decrease of “stimulus” spending,
  4. General  reticence to invest because of higher than normal risk.
  5. The economy has lost many years of growth- so fewer trucks are needed. (For instance, The precision machining industry sales are 85 percent of what they were in 2000 according to PMPA Business  Trends Report.
  6. The cost of  EPA 2010 Regulation compliant trucks is $10,000 higher. 

While the manufacturing indexes are showing improvement, we don’t see that any one of these 6 has gone away.  And with intermodal continuing to gain market share, the need for new Tractors remains weak in our opinion.

We think that the folks at  FTR Associates are right on the money with their research.

If supplying precision components to the heavy truck and trailer market is your company’s thing, we bet that you will find this FTR Associates to be a great new “Tool You Can Use.”

What is your take on the Heavy Truck Market? Are you seeing better than 3% growth? We said in December that heavy truck sales would lag GDP; if FTR Associates are correct at 3% growth for 2010 heavy truck,  what does that tell us about 2010 GDP?

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3 Responses to Heavy Truck Market- Update on Forecast

  1. Great article as usual, thanks for posting so much helpful stuff on a regular basis.

  2. This article predicts the accelerating demand for heavy truck. The uses outlined are realistic. To assume such, aftermarket truck parts sales for heavy truck components would increment naturally thus improving the economic scenario here in our horizon.

  3. movers frederick…

    […]Heavy Truck Market- Update on Forecast « Speaking of Precision Blog[…]…

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