A worker polishing a diesel engine at a Cummins plant in Seymour, Ind., last year.
Photo: Bloomberg NewsOrders for heavy-duty trucks in April plunged to the lowest level on record as trucking companies put expansion plans on ice due to upheaval from the coronavirus pandemic.
North American fleets ordered 4,000 of the Class 8 trucks used in highway transport last month, down 73% from April 2019 and 44% from March, according to preliminary estimates from FTR. The transportation research group said it was the lowest reading it has recorded since it began tracking orders in 1996.
Trucking companies canceled or delayed new equipment orders as much of the economy shut down, tanking demand from many industrial and retail customers. Demand measured by the ratio of loads to trucks fell 66% in April on trucking’s spot market, where shippers book last-minute transportation, according to online freight marketplace DAT Solutions LLC.
The weak market and uncertain outlook have made many trucking companies rein in spending. Last month, Canadian transportation and logistics company TFI International Inc. said it was slamming the brakes on capital spending for its U.S. truckload operations. After the second quarter, “everything has been canceled,” TFI Chief Executive Alain Bédard said in an April 22 call with investors.
“Fleets don’t need a lot of trucks in the short term and they’re unsure what they’ll need in the next few months, so they’re being cautious,” said Don Ake, FTR’s vice president of commercial vehicles.
The pandemic is accelerating a downturn in the heavy-duty truck market since the business reached a high point during 2018 as truckers raced to expand capacity on the back of booming freight demand. Trucking companies ordered a record 53,300 heavy-duty trucks in August 2018, according to FTR.
This April’s pullback in orders came as equipment makers already hit by a sagging market shut down or slowed production because of the coronavirus pandemic.
Daimler Trucks North America has suspended production at its plant in Portland, Ore., and two facilities in North Carolina, saying the work had “outpaced the current capabilities of the supply chain.” Those factories and the company’s facilities in Mexico are scheduled to resume production on May 11, the company said, while two other U.S. plants in North and South Carolina were operating “near full speed.”
Industry observers said resuming production could be hampered by a shortage of parts from factories in the U.S. and Mexico that have shut down since the pandemic began.
“The ramp out of this is going to be arduous,” said Kenny Vieth, president of market forecaster ACT Research, which reported similar results. “You can only build at the speed of your slowest supplier.”
Mr. Ake said the backlog of heavy-duty trucks ordered but not yet built, which was 100,700 units in March, will likely dip below 2017 levels once production resumes. “The industry was going slow anyway, and the backlog will probably go below that 94,000 mark [in 2017] eventually,” he said.
Write to Jennifer Smith at jennifer.smith@wsj.com
Copyright ©2020 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8
"heavy" - Google News
May 06, 2020 at 01:28AM
https://ift.tt/2L58a8o
Heavy-Duty Truck Orders Plunge to Record Low - The Wall Street Journal
"heavy" - Google News
https://ift.tt/35FbxvS
https://ift.tt/3c3RoCk
heavy
Bagikan Berita Ini
0 Response to "Heavy-Duty Truck Orders Plunge to Record Low - The Wall Street Journal"
Post a Comment