Heavy truck orders ended 2020 on a high note with an intake level of 52,100 units, according to preliminary data released Thursday by FTR.
December 2020 was the fourth-highest order total ever, and just 700 units fewer than November. Orders last month climbed 169% over a year ago.
ACT Research President and Senior Analyst Kenny Vieth noted the driver supply remains constrained and that supply-demand imbalance is reflected in rate data. With strong freight volumes, drivers in short supply, rates surging and carrier profits certain to follow, he said “the precise recipe for surging new vehicle demand, which continued in December, is created.”
“To get two back-to-back order months over 50,000 is a stellar accomplishment, after previously seeing orders crater to under 5,000 units in April,” said FTR Vice President of Commercial Vehicles Don Ake, adding that “2021 has the potential to be an incredible recovery year.”
Class 8 orders for 2020 totaled 283,000 units – about 104,000 more trucks than were ordered in 2019 – and Ake noted the industry has momentum rolling into 2021, as freight growth is robust, freight rates are elevated and fleet profits are rising. Consumer-based freight remains strong and there are indications that manufacturing activity is finally beginning to accelerate.
“As the economy continues to improve, fleets are showing increasing confidence about business conditions in 2021,” he said. “Profits are more than sufficient to replace used trucks and freight growth is stimulating expansion demand. Put those dynamics together and the industry is headed toward a robust year.”
A second stimulus will likely pump more money into the economy and accelerate recovery and Ake expects the COVID vaccine to get more people back to work, providing another economic boost.
“And the fleets are responding to this wave of good news by ordering trucks in near-record numbers,” he said. “After being slowed significantly by the pandemic, the Class 8 market is roaring ahead at a rapid rate.”
