Off-model: September Class 8 truck orders align with supply shortage

Editor’s Note: UPDATES with FTR comment and graphic

Orders for Class 8 trucks typically increase in September when manufacturers open their order books. This is not the case this year.

The combination of the semiconductor shortage and shortages in as many as 40 other parts needed to assemble heavy trucks has led manufacturers to write far fewer orders in September than the typical first month of fall.

“This is a complicated and bizarre situation that OEMs have never encountered before,” said Don Ake, vice president of commercial vehicles at FTR Transportation Intelligence. severe shortages of components, especially semiconductors.

The demand for new trucks is high. Freight rates continue to be high. But the manufacturers cannot keep up. Even the trucks they assemble are parked waiting for parts, a process called red marking. Paccar Inc. said Monday evening that third quarter deliveries of its Kenworth, Peterbilt and DAF trucks would be 7,000 units lower than the previous quarter.

Preliminary orders for Class 8 trucks in North America. (Source: FTR)

It’s a problem of supply, not demand

“It is important to note that it is not demand, but supply that dictates new order activity, as OEMs are wise in fully opening 2022 order books when there is no clear visibility of supply chain capacity next year, ”said Kenny Vieth. , president and senior analyst at ACT Research.

North American Class 8 preliminary orders in September were 27,400 units, up from 36,900 orders in August. FTR said 453,000 trucks had been ordered on a rolling 12-month basis. FTR pegged September preliminary orders at 28,100, down 12% year-on-year from last September.

“September traditionally marks the transition from the low in annual summer orders to the peak in fall order activity,” Vieth said.

“However, with demand indicators ranging from freight activity to freight rates and carrier profits in stark contrast to equipment shortages and capacity constraints in all modes of transportation, it is understandable that the September order volume of classes 5 to 8 could be interpreted as disappointing compared to the economic configuration. “

Ake added, “Unfortunately, the supply chain remains a huge mess. The parts and components are so limited, along with the raw materials, that it will take several months to rectify them, and conditions are expected to improve gradually, over an extended period.

Another factor suggesting a prolonged lull is recent reports of problems in China’s energy sector which, Vieth said, “dampen hopes that the current supply situation will surprise positively in terms of timing of recovery.”

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