FTR reports preliminary North American Class 8 net orders cooled off in May to 23,600 units. Class 8 orders are returning to a pace more in line with seasonal trends. May orders were down 32% m/m but still up 16,800 units y/y from the anemic level of 2020. Class 8 orders now total 420,000 units for the previous 12 months.
Class 8 orders have been on a torrid pace for eight months, and the drop-off in May does not represent a weakening of demand, as freight growth continues to be robust and spot rates are hitting all-time highs. Build slots for delivery this year are filling up, and OEMs are not yet booking for 2022.
Don Ake, vice president of commercial vehicles for FTR, commented, “Most fleets have ordered all the trucks they need for 2021. They are getting frustrated because production is unable to keep up with demand. Carriers need more trucks on the road now, but semiconductor and other component shortages continue to restrict production.”
“There is tremendous pent-up demand being generated in this market. Freight is growing at a brisk pace, but the supply chain bottlenecks slow the flow of new trucks coming off the production line. This, in turn, is keeping the spot market overheated.”
“OEMs are uncertain how to price 2022 models. The prices for steel, aluminum, and rubber have spiked after the economic restart. It is possible we will see record order volumes when the OEMs open their 2022 order boards.”