Owing to myriad negative factors, ACT Research continues to pull back on out-year expectations. Weak carrier profitability and still tractionless freight rates, expected tariff-driven goods inflation, a freight air pocket likely following the goods pull-forward in 1H’25, and uncertainty surrounding US economic policy and the status of the EPA’s low NOx Clean Truck regulation, as published in the latest release of the North American Commercial Vehicle OUTLOOK.
“This is the time of the year that heavy truck orders are weak. That seasonal weakness has been compounded by the aftershocks of April’s tariff and policy announcements, which continue to reverberate. Policy uncertainty coupled with still weak for-hire rate and profitability fundamentals, have exacerbated that seasonal order weakness,” according to Kenny Vieth, ACT’s President and Senior Analyst. “Using June data, the tractor order trends for the past 12m, 6m SAAR, and 3m SAAR are 176k, 129k, and 97k, respectively.”
Despite front-end order weakness, tractor sales have remained firm, rising since the onset of tariffs, as companies seek to take advantage of tariff-free equipment in inventory. With tariff-free inventory increasingly consumed, retail sales are expected to cool in the coming months as prices move higher.
Regarding vocational demand, Vieth added, “Much like the tractor market, vocational orders continue to trend lower, with the 12m, 6m SAAR, and 3m SAAR order levels at 86k, 60k, and 54k units, respectively.”
NA CV Forecast Report Overview
The NA CV forecast reports on the trucking industry forecast, providing a status of commercial vehicle demand, tactical and strategic market analysis and forecasts ranging out five years. The report’s objective is to give OEMs, suppliers, investors, and other interested market participants the information they need to make informed decisions in what is traditionally a deeply cyclical market. The report provides a complete overview of the North American markets, touching on relevant demand drivers starting with forward-looking activity metrics, orders and backlogs. Information included in this report covers build and retail sales forecasts and current market conditions for medium- and heavy-duty trucks/tractors, and trailers, North American macroeconomics by country, freight and carrier market performance, used equipment valuation trends, and regulatory environment analysis and impacts.
ACT Research Overview
ACT Research is recognized as the leading publisher of commercial vehicle truck, trailer, and bus industry data, market analysis and forecasts for the North America and China markets. ACT’s analytical services are used by all major North American truck and trailer manufacturers and their suppliers, as well as banking and investment companies. ACT Research is a contributor to the Blue Chip Economic Indicators and a member of the Wall Street Journal Economic Forecast Panel. ACT Research executives have received peer recognition, including election to the Board of Directors of the National Association for Business Economics, appointment as Consulting Economist to the National Private Truck Council, and the Lawrence R. Klein Award for Blue Chip Economic Indicators’ Most Accurate Economic Forecast over a four-year period. ACT Research senior staff members have earned accolades including Chicago Federal Reserve Automotive Outlook Symposium Best Overall Forecast, Wall Street Journal Top Economic Outlook, and USA Today Top 10 Economic Forecasters. More information can be found at www.actresearch.net.
Additional Resources
With a recovery in freight continuing to push out, tractor demand is projected to remain soft. With freight market conditions remaining soft, carrier profitability remains as an obstacle to stronger new equipment demand, as published in the latest release of the North American Commercial Vehicle OUTLOOK.
“The publicly traded for-hire fleets, whose balance sheets we have tracked for over three decades, saw their weakest net income margins since Q1’10 in Q1’25. With freight rate growth lagging the rate of inflation last quarter, there is no expectation that margins improved much in Q2,” according to Kenny Vieth, ACT’s President and Senior Analyst. “Private fleets have spent the past two years adding to fleet capacity, and we believe they have little need for additional supply, especially given significantly upside-down cost economics.”
Regarding vocational demand, Vieth added, “Like the tractor market, fading fundamentals and uncertainty have similarly negatively impacted demand for vocational equipment. Worsening housing and construction markets and regulatory uncertainty have sapped strength that looked all but certain at the beginning of the year.”
“With that in mind, preliminary June Class 8 orders totaled 9,400 units, down 36% y/y,” he concluded.
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