FTR reports preliminary Class 8 net orders for March came in above expectations and, for the third consecutive months, much higher than a year ago.
March orders, 22,800 units, were basically flat month-over-month but up 41 percent over last year.
Don Ake, Vice President of Commercial Vehicles at FTR, says backlogs are now close to where they were a year ago, and production rates are expected to increase significantly beginning with March totals.
“March orders are reflective of a more normal Class 8 market in a moderate, freight-driven upcycle,” Ake adds. “Replacement cycles are now getting back into a more traditional pattern. This reflects growing fleet confidence as they see freight growth returning after a difficult 2016. OEMs are ramping up production in response. There is renewed optimism in the industry.”
Orders are forecast to stay close to this level through May, similar in trend to 2013. Class 8 orders for the past six months annualize to 243,000, consistent with expected future build rates.
“This is a reserved, contained market upswing. It means it is easier for the OEMs to increase builds gradually and prices don’t fluctuate as much,” Ake says. “It provides some market stability. It is good for the industry, and a good sign for the economy in the second half of the year.”
According to preliminary data from ACT Research President and Senior Analyst Kenny Vieth, North American Classes 5-7 net orders rose to 24,200 units in March, an increase of 5 percent from February and 3 percent from a year ago. March’s preliminary order volume represented the biggest medium-duty order month in just over nine years.