October Orders for Classes 5-7 and 8 Subdued

Class 8 booked 25,900 net new orders in October, while Classes 5-7 posted 21,900 net orders in North America, according to ACT Research.

Steve Tam, ACT’s Vice-President-Commercial Vehicle Sector, noted that developments in the economy and industry continued to evolve in October, doing little to add any degree of clarity to a confounding situation. He said, “Whether one subscribes to the theory that both economic and industry woes have resulted in excess inventories that are currently correcting or the theory that weakening growth is more permanent in nature and will persist, the results are the same. Many in the industry have curtailed 2016 planned activity.” Tam added,

“Class 8 net orders failed to wow in October. Historically, a number of factors converge to send orders nearly 15% above average.” He continued, “That said, orders did increase 34% m/m, but at a lower absolute level than previously expected. And, the mismatch between order intake and build has resulted in a backlog drain that is now entering its eighth consecutive month.”

Concerning medium duty, Tam said, “Orders were equally as unimpressive for the Classes 5-7 market in October, though expectations were not quite as high as for the Class 8 market. Sequentially, demand dropped about 1%. Cumulatively Class 5 is up more than 11%, while Classes 6-7 are holding steady, down less than 1%.” He added, “Slowing in state and local government and municipality purchases accounted for much of the lower Classes 6-7 demand.”

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