After the strong end to 2024, with Class 8 orders booked at a 357k SAAR in Q4, the past two months have largely been defined by trade and economic policy uncertainty, which have thrown a wrench into business planning, as published in the latest release of the North American Commercial Vehicle OUTLOOK.
“Whether the slowdown in orders is a result of moderating economic activity, a response to the newfound uncertainty, or both remains an open question,” according to Kenny Vieth, ACT’s President and Senior Analyst. “Preliminary Class 8 orders dropped 34% y/y to 18,300 units in February. Seasonally adjusted, Class 8 orders fell 28% from January to 16,700 units, and a 200k unit SAAR—the lowest SA Class 8 order volume in nearly two years.”
Vieth added, “With the tractor market already at a low ebb, tariffs are starting to weigh on business decision making, reducing early-in-the-year economic expectations. In addition to uncertainty leading to corporate indecision, the apparent policy path is likely to weigh on key US Class 8 market indicators including freight volumes and by extension, freight rates, consumer spending and sentiment.”
“In addition to possibly seeing some production moved back to the US, the industry is likely racing to add as much inventory as they can before tariffs are fully enacted. Hence, while we cut our forecasts and lower 2025 expectations, tariffs and the threat of more to come are actually boosting activity in the near term. As is always the case with pulling activity forward, there are paybacks,” he concluded.
NA CV Forecast Report Overview
The NA CV forecast reports on the trucking industry forecast, providing a status of commercial vehicle demand, tactical and strategic market analysis and forecasts ranging out five years. The report’s objective is to give OEMs, suppliers, investors, and other interested market participants the information they need to make informed decisions in what is traditionally a deeply cyclical market. The report provides a complete overview of the North American markets, touching on relevant demand drivers starting with forward-looking activity metrics, orders and backlogs. Information included in this report covers build and retail sales forecasts and current market conditions for medium- and heavy-duty trucks/tractors, and trailers, North American macroeconomics by country, freight and carrier market performance, used equipment valuation trends, and regulatory environment analysis and impacts.
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ACT Research is recognized as the leading publisher of commercial vehicle truck, trailer, and bus industry data, market analysis and forecasts for the North America and China markets. ACT’s analytical services are used by all major North American truck and trailer manufacturers and their suppliers, as well as banking and investment companies. ACT Research is a contributor to the Blue Chip Economic Indicators and a member of the Wall Street Journal Economic Forecast Panel. ACT Research executives have received peer recognition, including election to the Board of Directors of the National Association for Business Economics, appointment as Consulting Economist to the National Private Truck Council, and the Lawrence R. Klein Award for Blue Chip Economic Indicators’ Most Accurate Economic Forecast over a four-year period. ACT Research senior staff members have earned accolades including Chicago Federal Reserve Automotive Outlook Symposium Best Overall Forecast, Wall Street Journal Top Economic Outlook, and USA Today Top 10 Economic Forecasters. More information can be found at www.actresearch.net.
Additional Resources
Continued healthy activity for heavy vocational trucks since September’s order explosion suggests some level of prebuying has begun on top of strong end market demand as work truck buyers look to get ahead of the EPA’s 2027 Clean Truck regulation and 2028’s ZEV-targeting GHG-3 regulation. While we include GHG-3, we expect rulemaking will ultimately find its way to the dustbin or otherwise be heavily rewritten, as published in the latest release of the North American Commercial Vehicle OUTLOOK.
“Amid healthy demand, strong build, and already high inventories, the industry’s capacity to sell finished products to end users could well be the limiting factor for production in 2025,” according to Kenny Vieth, ACT’s President and Senior Analyst.
He added, “With tractor demand strength more suspect in early 2025, vocational truck production should continue at high levels at the start of the year. Vocational build per day rose to a level not seen since 2006, at 513 units per day in November, and blew past that level, to 537 units per day, in December.”
“Importantly, we note the vocational market’s chokepoint has not been capacity-constrained OEM components, but body-builder capacity constraints. While improving, retail sales rates continue to lag build rates, resulting in inventory accumulation throughout last year. Compared to a nearly 120k annualized build rate in recent months, the retail sales rate continued to rise into the end of 2024, averaging a 111k annualized rate in Q4,” Vieth concluded.
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