Trucking news: ACT report points to continued demand for commercial vehicles
June 15, 2011
Even with some recent moderation in freight volumes and signs of renewed economic weakness, ACT Research, a provider of data and analysis for trucks and other commercial vehicles, said this week that demand is still strong for commercial vehicles.
In the most recent release of its ACT North American Commercial Vehicle Outlook, the firm said that “solid” commercial vehicle demand is intact for the remainder of 2011 and into 2012, with ACT officials explaining this is due to reflects pent-up replacement needs and improved financial performance at the fleets, supported by improved credit availability for well-qualified customers.
“While we have reduced our expectations for US economic growth somewhat, we still expect the overall economy to progress close to trend over during 2011 and into 2012,” stated Sam Kahan, ACT’s chief economist, in a statement. “There might be a soft patch in freight over the next month or two, but demand for Class 8 trucks continues to be strong. We feel that the industry’s ability to ‘build’ might actually be a volume constraint in 2011.”
Earlier this month, ACT reported that preliminary data for Class 8 trucks in May was down from a very strong April.
ACT reported that preliminary net orders in May for heavy-duty Class 8 vehicles in North American markets hit 24,400 units, marking the seventh straight month orders have been above the 24,000 mark and a “clear sign” of increased demand.
ACT said a final order tally for May would come in later this month. The firm added that preliminary net order numbers are subject to revision and are typically accurate to within 5 percent plus or minus.
“Freight hauling capacity is still tight and not showing any signs of letting up,” said Steve Tam, ACT vice president-commercial sector, in a recent interview. “From a shipper’s perspective, that means carriers are going to keep coming back to them for rate increases and some assurance that business is going to keep going. They could be looking for more favorable fuel surcharges, depending on what happens with fuel prices. Unfortunately, shippers are getting the short end of the stick this time around, whereas things are going pretty well for carriers. They have the pricing power and the ball is in their court at this point.
Tam added that carriers also finally have the wherewithal to replace some aging equipment that requires more care and maintenance, which comes with an attached price tag.
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