April was the worst month for new Class 8 truck sales in the U.S. market in more than three years. To find a worse month, you’d have to go back 37 months to February 2017.
A total of 12,986 new Class 8 trucks were sold in April, according to information received from ACT Research (actresearch.net), a decline of 47.6% from the 24,480 sold in the same month of 2019. April sales dropped 23.1% from 16,892 sold in March.
Of those trucks sold this April, 8,156 were fifth-wheel-equipped tractors, down 30.1% from March sales of 11,673 and down 25.5% from April 2019 sales of 18,303.
The remaining 4,830 trucks, or 37.2%, were vocational units equipped with dump, refuse or other bodies. The percentage of vocational trucks is typically 25% to 30%, so the higher percentage in April indicates that sales of over-the-road trucks are taking a bigger beating than sales of vocational trucks. The April number was 7.5% lower than March sales and 25.5% lower than April 2019 sales.
The declining sales were not unexpected, as numbers were already running nearly 28.0% behind last year’s pace. A condition of overcapacity in the freight market and uncertainty over economic conditions had already combined to put a damper on the market.
Then came COVID-19.
The closing of overseas manufacturers slowed imports; then the shutdown of domestic businesses deemed “nonessential” depressed available freight levels to crisis proportions.
May sales aren’t expected to be much better, if at all, despite the gradual relaxing of stay-at-home orders and the reopening of businesses. That’s because of the time it takes to restart an economy that has been virtually shut down.
“It takes a lot of people marching at the same speed to turn the manufacturing sector back on,” said Kenny Vieth, president and senior analyst at ACT Research, noting that, even though a plant may reopen, the parts and materials needed to function may not be readily available.
“With current inventories and supply chains, we can say that April will probably not be the ‘bottom’ of the economic downturn,” he said.
In the used Class 8 truck market, sales volumes declined 8% in April compared to March, according to the latest preliminary release of State of the Industry: U.S. Classes 3-8 Used Trucks published by ACT Research. Average prices for used tractors in dealer-to-dealer sales also fell 8%, while the average used truck sold was 2% older. Compared to April 2019, average prices were down 20%, while the age of the average truck dropped 5% and the odometer miles declined 2%.
As for new trucks, the manufacturer that has taken the biggest hit so far in 2020, on a percentage basis, is International, according to information received from Wards Intelligence (wardsintelligence.com). Sales of 7,499 Class 8 trucks on the U.S. market for the first four months of the year lag 41.9% behind the 12,902 units sold at the same point last year. Market share for the period has dropped from 14.8% to 12.5%. International was the only OEM to sell more Class 8 trucks in the U.S. market in April than in March, 1,961 to 1,886 for an increase of 4%. Compared to April 2019, however, sales declined 44.6% from 3,547 sold in that month.
Freightliner’s April sales of 4,315 trucks showed a decline of 27.9% from March sales of 5,983 and were 47.4% behind the 8,209 sold in April 2019. For the year to date, Freightliner’s 22,202 Class 8 trucks sold on the U.S. market trails last year’s January to April sales by 11,593 units, or 34.3%. The company’s share of the U.S. Class 8 market has dropped from 38.9% at the end of April 2019 to 36.9% this year, and 34.1% for the month of April.
To find the last month that Volvo Trucks sold fewer than 1,000 Class 8 units in the U.S., you’d have to go all the way back to January 2012. The OEM sold 951 trucks in April, a drop of 44.6% from March sales of 1,717. Compared to April 2019, sales dropped more than half (59.6%) from 2,199 trucks sold. For the year to date, Volvo sales are down 31.2%, slightly more than the decline for the entire market.
Volvo-owned Mack Trucks outsold Volvo Trucks in the U.S. Class 8 market in April with delivery of 1,063 units, a 24.3% decline from March sales of 1,404 and 44.8% beneath April 2019 sales of 1,924. Mack has actually gained market share in 2020, going from 6.6% of Class 8 trucks sold at the end of April 2019 to 7.8% at the same point this year. April 2020 sales represented 8.4% of the market, which may be attributable to the heavy presence Mack has in the vocational market.
Kenworth sold 2,290 Class 8 trucks in April, a 15.7% decline from March sales and 39.0% behind April 2019 sales. For the year to date, the company has sold 9,508 units, 20.5% behind last year’s pace of 11,955. As for market share, the company’s smaller-than-average sales declines have actually increased its share of the market, which climbed from 13.8% at the end of April last year to 15.8% at the same point this year and reached 18.1% for the month of April 2020.
Peterbilt sales of 1,553 were 30.9% behind March sales of 2,247 and 59.6% beneath April 2019 sales of 3,842. For the year to date, Peterbilt sales nearly match the industry average, declining 30.3% compared to 30.7 for the entire industry.