Class 8 Tractor Demand Above Replacement Level in January

ACT Research reports Class 8 net orders, at 27,125 units, were up 45% y/y

Final January Class 8 net orders, at 27,125 units, were up 45% y/y. Total Classes 5-7 orders were up 14% y/y at 19,954 units, as published in ACT Research’s latest State of the Industry: NA Classes 5-8 report.

“US Class 8 tractor orders surprised to an above-replacement level of 16,765 units, up 44% y/y,” according to Kenny Vieth, ACT’s President and Senior Analyst. “Seasonality is one component, but given the state of for-hire truckload rates, we continue to suspect private fleets as the primary driver behind US tractor demand. As well, the LTL segment remains a bright spot relative to TL and is likely also contributing. The US economy’s current strength doesn’t hurt either.”

Regarding Classes 5-7, he added, “MD build totaled 20,931 units, up 21% y/y. Inventories remain highly elevated, as MD bodybuilder labor challenges persist, totaling 85,330 units

nominally, up 31% y/y. Classes 5-7 retail sales remained strong at 19,950 units.”

“Class 8 build decreased 7.3% y/y to 26,926 units in January,” Vieth concluded. “Class 8 inventories rose 1,909 units m/m to 66,277 in January, up 14.3% y/y. Following December’s dash to get equipment finished ahead of regulations starting at the beginning of 2024, Class 8 retail sales totaled 24.5k units in January, up 2.9% y/y. Amid the weakest period of the year for retail sales, and with still strong production, we continue to see risk in the potential for rapid inventory escalation in early 2024.”

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