According to ACT Research’s (ACT) latest State of the Industry: NA Classes 5-8 report, November Class 8 net orders (32.6k) were robust, bringing the three-month total to 128,000. For now, business activity in the truck industry rolls on, seemingly unphased by higher interest rates. That said, ACT expects this dynamic to shift in 2H’23, as the Fed continues its aggressive push to subdue inflation.
According to Eric Crawford, vice president and senior analyst, ACT, “Most notable this month was the continued strength in Class 8 order activity. Also, heavy-duty [HD] production levels were ahead of OEM build plans, while medium duty [MD] fell short. Otherwise, activity was largely in line with expectations, with cancellation volumes and rates remaining low.
“Over the course of Q4’21, there were nearly 52,000 Class 8 cancellations—orders that were booked for but not delivered in 2021—rebooked into 2022 build slots,” he continued. “While cancellations are running at historically low rates today, we caution that, unless the OEMs change the process of dealing with these paperwork non-cancellation cancellations, we may see cancellations elevate sharply in December.”
Regarding the anticipated economic downturn, Crawford shared, “Though this week’s 50-basis point increase is a welcome sign, cracks in the economy are becoming more evident: the impact of higher rates has begun to slow activity in the housing sector, and large layoffs have started in the tech sector.”