Trucking Economy in North America Poses Concern for Truckmakers
Published On May 18, 2016
The future may not be bright for the trucking industry in one of the world’s largest economy. As the summer order season remains at a low currently, commercial vehicle operators in the US are bearing the brunt of the falling demand in truck transport. The trend has been observed in not only the trucking industry, but also in other related segments as well, such as agricultural machinery.
According to truckinginfo.com, fleet operators in the US have “no additional need for capacity.” Class 8 trucks (vehicles with GVW more than 15,000 kgs) raked the lowest order numbers last year as compared to the previous six years. From the astounding 46,000 units in October 2014, operators ordered as less as 13,500 vehicles in April 2016, thus marking a drop of 16 percent in the month and by 39 percent in the past year.
Apart from a slump in orders, revenues from transporting goods are also declining. From an impressive six percent jump in revenue per loaded mile (on annualized basis) in November 2014, hike in transport rates declined to less than one percent in February this year, thus posing a concern as moving cargo by road in North America in the near future may become cheaper than the previous year.
A report from ACT Research, a leading publisher of commercial vehicle industry data, says that the supply of Class 8 trucks continues to rise faster than the demand. Apart from this, dollar value of exports through trucks to Canada declined by as much as 25 percent due to a weaker Canadian dollar and a weak economy.
Apart from truck makers, other related industries such as the used farm equipment sector has witnessed a downfall, declining by a third between the first quarter of 2013 and the final quarter of 2015.