Class 8 net orders for October reached 43,200 units, according to preliminary data released by FTR, the second consecutive month truck orders have been elevated year-over-year. October order activity was down 23% month-over-month and up 77% year-over-year. Class 8 orders now totaling 271,000 units for the last 12 months.
ACT Research Vice President and Senior Analyst Eric Crawford said the strength in orders is a reflection of OEMs having more broadly opened orderboards for 2023, and ongoing pent-up replacement demand in the market due to the constricted production environment of the past two years that has limited many fleets from replacing aged equipment, "with tailwinds from strong carrier profitability and elevated fleet age proving resilient."
"We continue to expect a freight recession, and an eventual economic recession – mild to medium in magnitude – but OEMs at this point have clear visibility to a strong (first half of 2023), barring any unforeseen cataclysmic events," he said.
While OEMs are now filling build slots well into the second quarter of 2023 and the early part of the third quarter, FTR Commercial Vehicle Analyst Charles Roth said shortages continue to be a week-to-week issue. "However, the overall sentiment from manufacturers is optimistic that improvements will be made in the coming months and throughout the first half of next year."
October was the turning point for the Class 8 market, he said, adding while the freight market continues to face headwinds, overall fleet sentiment remains optimistic.
"While some OEMs have indicated that they have implemented allocation plans for dealers, the retail channel is another segment of the market that has yet to be able to maintain sufficient levels of inventory due to the limited availability of supply," Roth said. "With two extremely strong months of net orders, there is the potential that we see a gradual decrease month over month in net orders as we close out the year.”