FTR reports preliminary North American Class 8 net orders show modest gain in June to 15,000 units

FTR reports preliminary North American Class 8 net orders for June rose modestly m/m to 15,000 units. Orders continue to be subdued, as 2023 build slots remain restricted due to limited visibility into future conditions surrounding material costs and lead times. June activity was up 13% from May and down 36% y/y. Class 8 orders have totaled 260,000 units over the last twelve months.

OEMs are quickly running out of build slots in 2022. Orders continue to track in a restricted range, with June’s total being in line with the prior three months. OEMs are still working to increase build rates; however, semiconductors, tires, and other key components remain in short supply and continue to limit production.

Charles Roth, analyst-commercial vehicles for FTR, commented “The June number is positive in the sense that all OEMs entered orders indicating some optimism about improved future supply chain performance. The current order volume still understates the tremendous demand for new trucks.

“The OEMs have a large number of fleet commitments for 2023. They are delaying entering these orders until they know how many they will be able to build each month. Supply chain delays continue to constrain build rates.

“As a result of replacement demand, fleets still need a considerable number of new trucks right now. Industry capacity remains extremely tight, resulting in elevated freight rates. The carriers have freight to haul and funds available for new trucks, but OEMs remain limited due to parts shortages.  Also, large fleets are now running vehicles beyond their trade-in cycles and need to trade in older trucks, which will result in increased replacement demand in 2023.”