Class 8 orders down despite strong demand – Equipment
As OEMs manage their Q1 production slots in various ways, North American Class 8 orders for September fell about 29% month-over-month to between 27,400 and 28,400 units, reported ACT Research and FTR, respectively.
September order activity was down 12% year-on-year. with Class 8 orders now totaling 453,000 units in the past 12 months, FTR officials said in a press release.
The drop in orders came as OEMs manage their first-quarter production slots in a variety of ways, FTR said. Some manufacturers continue to take orders in a measured fashion, filling openings as they become available. Other OEMs are postponing unfulfilled orders from 2021 to 2022 and delaying new bookings from 2022.
“This is a complicated and bizarre situation that OEMs have never encountered before,” said Don Ake, vice president of commercial vehicles for FTR. “There are many orders due to be built in 2021 that cannot be fulfilled due to the severe shortage of components, especially semiconductors. OEMs don’t know when they will be able to build the remaining 2021 orders and all new orders, as parts shortages are now expected to continue until next year. They cannot plan production because they do not know their actual production capacity.
Ake said the order number is not a true indicator of demand for trucks in 2022.
“There is a significant pent-up demand for the remaining trucks from 2021 as OEMs were limited in their production,” he said. “Add to that the strong demand expected for 2022 due to the strong growth in freight. Fleets have a huge need for new trucks in 2022, however, OEMs are delaying order entry until the supply chain situation is clearer. “
Kenny Vieth, President and Senior Analyst, ACT, added: “It is important to note that it is not demand, but supply that drives new order activity, as OEMs make good sense in opening up completely. 2022 order books when there is no clear visibility of supply chain capacity next year. And, as the story is only just beginning to unfold, recent reports of China’s energy sector problems dampen hopes that the current supply situation will surprise positively in terms of the timing of the recovery. “