Subscribe to our free, weekly email newsletter!


FTR reports May Class 8 net orders meet modest expectations

By Jeff Berman, Group News Editor
June 07, 2012

Freight transportation forecasting firm FTR Associates reported this week that its preliminary data for May Class 8 truck net orders came in at 17,650 units.

FTR said this number, which represents orders for all major North America-based OEM’s, is up following four months of declines to start the year, with May up 5 percent over April and down 24 percent compared to May 2011. And it added that the annualized order numbers for the most recent three-month period—including May—trends out to 216,700 units, which pales compared to the 308,000 annualized rate from the December-February period.
FTR officials said that May orders were within its expectation range although it remains below previous projections and estimates by various industry stakeholders.

And FTR President Eric Starks said in a statement that the ongoing weakness is putting additional pressure on the OEMs to lower their build rates over the next several months, adding that with monthly orders in the 17,000 range and production in the 25,000 range there is a “disconnect” in effect.

“A dramatic increase in order activity is needed in order for the OEMs to continue production at their current pace,” Starks said. “Over the next few months we expect orders to remain near current levels, as the summer is traditionally a slower time of the year for order activity. It is important to note that even with the recent slowing in order activity, the levels are still relatively healthy for the industry.”

FTR Director of Transportation Analysis Jon Starks reiterated that point, explaining in an interview that while things are sluggish on the orders front, they are not necessarily bad.

One reason for this disconnect, said Jon Starks, is that there was way too much optimism on the OEM side.

“They got ahead of themselves and saw things going in one direction much too fast, so when we get to the back half of 2012 we think there is going to be a significant reduction coming in terms of what the OEMs are doing,” he explained.

Unless there is a strong surge in orders in the next few months, Jon Starks said it is very likely OEM production numbers are going to have to come down. He also noted that a “weak spell” for orders in 2011 carried over into 2012, with OEM’s requiring time to sort through the net effect of orders.

Given that situation, he said it stands to reason that Class 8 sales will be sluggish for the next 6-to-12 months.

“At the beginning of the year OEMS were producing well above what the sales environment was and had built out quite a bit of inventory on the production side,” said Jon Starks. “Sales did not drop off, though, instead they were more sluggish than anticipated.”

About the Author

Jeff Berman headshot
Jeff Berman
Group News Editor

Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. .(JavaScript must be enabled to view this email address).


Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

The index ISM uses to measure non-manufacturing growth—known as the NMI—was 56.0 in June, which edged out May by 0.3 percent.

Regardless of the date or year, one thing is beyond consistent when it comes to key themes in freight transportation logistics: the state of United States highways and related transportation infrastructure is in an eternal state of chaos and disrepair.

The high-volume warehouse or distribution center that supports B2B, Omni-channel activities, direct-to-consumer shipments, and the Internet of Things all require a flexible and scalable supply chain in order to function at optimal capacity. The problem is that most of today's supply chains are made up of fragmented silos of information that compromise their ability to compete, be responsive to customer demands or seize new business opportunities.

As customers' demands constantly evolve, transportation and logistics (T&L) operations are being put under growing pressure to offer more efficient delivery services, while not compromising on customer service. Using findings from a research survey conducted among transport and logistics managers around the world, this report explores how a combination of mobile technology implementations for mobile workers, and process re-engineering efforts can elevate operations to the next level.

It's a fact - most best-of-breed WMS providers force you to pay every time you require a system change. Uncover five more dirty secrets many warehouse management systems providers don't want you to know. Download the white paper 5 Dirty Secrets of Warehouse Management Systems to discover these hidden truths and gain valuable information on considerations for evaluating WMS vendors.

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2015 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA