With more than 250 years of combined industry experience, ACT Research is the leader in market data, industry analysis, and forecasting for the commercial vehicle and transportation markets.
1. Economy - Based on the final estimate of Q1 real GDP, the US economy expanded at a 1.4% q/q annual rate, up from 1.3% in the previous estimate and well below the 3.4% growth rate posted in Q4’23.
2. Medium Duty - June’s preliminary net orders of 16,500 MD trucks (+5.0% m/m), though improved, still indicate subpar demand.
3. Heavy Duty - The industry is in the heart of the weakest period of the year for orders, and with carrier profits at levels not seen since early 2010, there does not seem to be a strong financial impetus to drive orders sharply higher into the fall.
4. Trailer - Total cancellations oscillated to the higher side of the pendulum in May. The cancellation rate grew to 3.2% of the backlog, from April’s 1.5% rate.
5. Used Truck - Same dealer used Class 8 retail sales slowed for a third consecutive month in May. The 3.9% decline matched the seasonal drop indicated by history.
2. US dry van TL spot rates, net fuel, rose 6₵ m/m to $1.65 per mile in June, unchanged from a year ago.
3. The Driver Availability Index increased to 52.9 in May, from 51.0 in April. Driver availability remains persistently elevated and far from a shortage, partly supported by older drivers sticking around to help with higher living costs, and partly by the rise in migration in recent years.
4. Freight market conditions are usually soft in early July, but DAT’s load/truck ratio rose meaningfully in the days following Beryl and have remained stronger than normal seasonality since.
5. The Supply-Demand Balance jumped in May to 58.7 (SA), from 47.5 in April.
After last month’s anomalous order number, June’s activity offers a more reflective view of current market conditions.
Final North American Class 8 net orders totaled 14,604 units in June (18.2k seasonally adjusted), down 13% y/y as we move through the weakest period of the year for orders.
The used Class 8 average retail sale price took a big hit in June, slumping 7.6% m/m and 20% y/y to $54,300 units.
“We signaled the price drop last month, based on the fact that freight growth remains somewhat elusive,” said Steve Tam, Vice President at ACT Research. “Prices are expected to remain stable at this lower level through 2024, now transitioning to y/y growth in early 2025.”
June net orders, at 6,300 units, were 19% lower y/y, but a mere 275 units above May’s intake. June’s order tally brings Q2 net orders to 26k units (-14% from Q2’23) and closes the first half of 2024 with 74.5k net orders placed. The first-half tally was 24% lower than the intake of 1H’23, with its faster paced order environment, lingering pent-up demand, and a still moderately congested supply chain.
“Seasonally adjusted, June’s orders were more than 8,100 units compared to a 7,100 SA rate in May,” said Jennifer McNealy, Director–CV Market Research & Publications at ACT Research. “On that basis, orders increased 14% m/m. Dry van orders contracted 56% y/y, while reefers and flats were significantly higher than their respective tepid net order tallies last June.”