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 ACT Research's 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,” said 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.
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.