OCTOBER 2024 DRIVING DATA
Key Observations From October's Reports
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“On one side of the divide, vocational equipment demand continues to be supported by secular trends and stimulus programs. The clean energy transition and AI are driving utility infrastructure investment, while government programs, such as CHIPS and BIL, have boosted public infrastructure and reshoring projects.”
-Kenny Vieth, President and Senior Analyst
N.A. Commercial Vehicle OUTLOOK
1. Economy - In the final release of Q2 GDP, growth was unchanged at 3.0% q/q SAAR. The update primarily reflected upward revisions to private inventory investment and government spending, offset by downward revisions to residential and nonresidential fixed investment and exports.
2. Medium Duty - September’s preliminary net orders of 14,800 MD trucks (+/- 5.0% m/m) mark a third straight month of below-trend demand.
3. Heavy Duty - Class 8 orders jumped well above trend and seasonally elevated expectations in September. NA Class 8 net orders rose to 37,100 units, more than doubling August’s volume, and even 0.3% above formidable year-ago comparison.
4. Trailer - The build rate, at 850 units per day (upd), was lower than July’s 900 upd rate, as the industry reacts to falling demand, and down nearly 35% y/y.
5. Used Truck - Same dealer used Class 8 retail sales faltered in August, returning to a pattern of slowing. The 7.7% decrease was counter to the ten-percentage point seasonal improvement indicated by history.
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N.A. Commercial Vehicle OUTLOOK?
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N.A. Commercial Vehicle OUTLOOK
Freight Forecast: U.S. Rate & Volume OUTLOOK
2. US dry van TL spot rates, net fuel, fell 1₵ m/m to $1.59 per mile in September.
3. The Driver Availability Index decreased to 55.4 in August, from 53.1 in July, marking the 27th month in a row the index has been at or above 50. Driver availability remains persistently elevated and far from a shortage, party supported by older drivers sticking around to help with higher living costs, and partly by the rise in migration in the past few years.
4. Our aggregated seasonally adjusted DAT load/truck ratio broke above 7 in early October, suggesting spot rates will rise modestly in the near term.
5. The Supply-Demand Balance increased in August to 54.5, from 49.7 in July.
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Freight Forecast: U.S. Rate & Volume OUTLOOK?
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Freight Forecast: U.S. Rate & Volume OUTLOOK
State of the Industry: N.A. Classes 5-8 Vehicles
Final North American Class 8 net orders totaled a strong 37,100 units in September, kicking off the beginning of “order season.” While the top line flatters, the underlying numbers point to a bifurcated market with softness in tractors and considerable strength in vocational.
“Tractor orders were down 32% y/y at 17,000 units, as a weak for-hire market weighs down capital budgets. Vocational orders surged in September to 20,000 units and were up 71% y/y,” according to Kenny Vieth, ACT’s President and Senior Analyst. “With production capacity constrained in recent years, lingering pent-up demand and string end markets—still-plentiful stimulus money from CHIPS, IRA, IIJA projects, construction in Mexico, and utility investments—provide strong tailwinds in vocational.”
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SOI: Classes 5-8?
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SOI: Classes 5-8
State of the Industry: U.S. Used Truck Classes 3-8
September activity erased August’s strength in the average retail sale price for Class 8 trucks, which dropped 5.2% m/m.
“On a y/y basis, prices were 14% lower. Prices are expected to remain stable at or around this lower level through 2024, transitioning to y/y growth in early 2025,” said Steve Tam, Vice President at ACT Research.
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SOI: Used Truck?
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SOI: Used Truck
State of the Industry: U.S. Trailers
September net trailer orders, at 12,200 units, closed Q3’s net order intake at 27,000 units. This brings ytd net order activity to 101.6k units.
“Build significantly outpaced orders again in September, but this time by only 4,500 units compared to August’s 11k-unit drop; backlogs contracted 7% sequentially,” said Jennifer McNealy, Director–CV Market Research & Publications at ACT Research. “While down m/m, the backlog was dramatically lower (-55%) against 2023’s firmer backdrop.”
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SOI: U.S. Trailers?
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SOI: U.S. Trailers
