ACT Research 2016 Forecast Report Card
Examining the 2016 market outcomes and ACT Research’s forecasts in the three years leading up to December 2016, it is clear that one forecast did not live up to the quality of the other two forecasts. The weak Class 8 forecast performance broke a string of solid forecasts, falling short of our and our customers’ expectations for forecast quality.
Assigning letter grades, we would give an “A+” for a tight MD forecast and consistent excellence, an “A” for solid trailer forecast execution, and a “C” for Class 8 after back-to-back “A” grades in 2014 and 2015.
The Classes 5-7 forecast continues to excel, marking a fourth consecutive year of forecasts within 10% of what actually transpired for the entire 36-month period, as the market continued on its steady and measured upward course. In the case of Classes 5-7, there has not been a forecast outside of 10% within three years of actual since 2013.
The popping of the global commodity bubble in Q3’14 and the delayed recognition of duration of low prices and impact on freight creation left the Class 8 forecast begging. While forecast cuts began in September 2015, the recognition was late and insufficiently imaginative in terms of decrement. It wasn’t until 12 months from actual that Class 8 forecasts came within 10% of 2016’s final build tally.
The 2016 trailer forecast continued a string of solid predictions, with just one forecast outside of 5% in our three-year window. Assisting forecast performance were expectations that pent-up van trailer demand remained sated.