Connect with us

Business

ACT Research says Class 8 cancellations continue on low side

Published

on

ACT Research President and Senior Analyst Kenny Vieth said the Class 8 story remains one of current demand strength. (Courtesy: ACT RESEARCH)

COLUMBUS, Ind. —  According to ACT Research’s latest State of the Industry: Classes 5-8 Report, May’s Class 8 metrics generally aligned with expectations with the lone exception of cancellations, which continued to surprise on the low side.

Additional data for the Class 8 market show still-large (but quickly shrinking) backlogs, weak orders, strong build, bigger inventories and good follow-through on sales.

“Data continue to tell the same stories we have been reporting. First and foremost, the story remains one of current demand strength: The near-term backlog remains full and strong retail sales highlight good follow-through from previously booked orders,” said Kenny Vieth, ACT Research’s president and senior analyst. “The second story starts with softening freight metrics, pivots on robust build and sales, and ends at the nominal reality of a 78k Class 8 inventory. In a nutshell, freight growth is stagnating, while Class 8 population growth accelerates, planting the seeds for the end of the current up-cycle in demand.”

“Medium duty metrics remained in-line with expectations again in May, with most metrics close to their prevailing trends, if displaying some fraying at the edges,” Vieth said.

ACT Research is a publisher of commercial vehicle truck, trailer, and bus industry data, market analysis and forecasting services for the North American 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.

More information can be found at www.actresearch.net.

 

 

Continue Reading
Advertisement
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Business

Navistar to build new Class 6-8 manufacturing plant in San Antonio area

Published

on

Navistar’s new manufacturing plant will have the flexibility to build Class 6-8 vehicles, complementing the company’s existing assembly manufacturing footprint, which includes truck assembly plants in Springfield, Ohio, and Escobedo, Mexico. The plant will have the flexibility to build Class 6-8 trucks. Pictured is the International LT Series farm model. (Courtesy: NAVISTAR)

LISLE, Ill. — Navistar, a maker of commercial trucks and buses, said Thursday it will be making a capital investment of more than $250 million to build a new manufacturing facility in Texas.

The investment, which is contingent on finalization of various incentive packages, will bring approximately 600 jobs to the San Antonio area.

“Over the last five years, Navistar has made significant investments to improve our position in the market,” said Troy Clarke, Navistar chairman, president and chief executive officer. “This investment will create a benchmark assembly facility to improve quality, lower costs and provide capacity to support anticipated industry growth, as well as market share gains.”

The new manufacturing plant will have the flexibility to build Class 6-8 vehicles, complementing Navistar’s existing assembly manufacturing footprint, which includes truck assembly plants in Springfield, Ohio, and Escobedo, Mexico.

Navistar’s trucks are manufactured under the brand name International.

The announcement of the new Texas plant was part of Navistar’s Investor Day where company executives presented its 2020-24 strategy “Navistar 4.0” that includes a plan to increase its EBITA margins to 12%.

Clarke said “Navistar 4.0” includes the following elements:

  • Improve EBITDA margins to 10% by 2022 and 12% by 2024.
  • Grow market share and become the number one choice of the customer through new product offerings and customer segmentation.
  • Implement a single platform strategy to optimize use of R&D resources and commonization of parts and tooling.
  • Increase modular design resulting in customer benefits, speed to market and lower product costs.
  • Build a new truck assembly facility in San Antonio, Texas, reducing logistics and manufacturing costs.
  • Use the TRATON alliance to provide significant procurement savings, more efficient research and development spend and new integrated powertrain offerings for customers.
  • Grow Aftersales revenues with an expanding distribution network, growing private label sales and e-commerce initiatives.
  • Improve financial results allowing the company to invest in growth initiatives, de-lever the balance sheet and fully fund its defined benefit pension plans by 2025.

Building on the major advances achieved in the last five years, including gains from an alliance with TRATON Group, Navistar 4.0 lays out a clear path for the company’s ongoing transformation, Clarke said.

“Navistar is committed to building on the gains of the past five years to improve financial returns to shareholders,” he said. “Navistar 4.0 establishes a clear road map to grow EBITDA margins to 12%, while also winning in the marketplace.”

The new Texas investment builds on Navistar’s recently announced plans to invest $125 million in the Huntsville, Alabama, engine plant to produce next-generation, big-bore powertrains developed as part of the alliance with TRATON, a subsidiary of Volkswagen AG and a global commercial vehicle manufacturer worldwide

The Texas site is located on a critical corridor along Interstate 35, which links Navistar’s southern United States and Mexico supply bases, allowing for significant logistic improvements, resulting in lower cost and enhanced profitability.

“This investment by Navistar is paramount to Texas’ success in growing our diverse and highly skilled manufacturing workforce,” said Texas Gov. Greg Abbott. “The Lone Star State is the new frontier in innovation and I am confident that this partnership will usher in even greater economic prosperity for our state.”

“We are so proud to have a company like Navistar, a leader in vehicle innovation, in San Antonio,” said San Antonio Mayor Ron Nirenberg. “It shows that our strategy to grow our advanced manufacturing sector is working.”

“The county has, for many years, been touting the strength of our Texas-Mexico region as a platform for vehicle production,” said Judge Nelson Wolff. “Navistar’s decision to locate their newest facility here is just the latest affirmation that our community is uniquely situated to host world-class companies in advanced manufacturing industries. We are thrilled to have them in Bexar County.”

Navistar plans to break ground on the property later this year and anticipates production to begin approximately 24 months later.

In its presentation Thursday, Navistar also provided industry and company financial guidance for 2020, including:

  • Industry retail deliveries of Class 6-8 trucks and buses in the United States and Canada are forecast to be between 335,000 and 365,000 units.
  • Revenues are expected to be between $10.0 billion and $10.5 billion.
  • Adjusted EBITDA is expected to be $775 million to $825 million.
  • Manufacturing free cash flow is expected to be breakeven excluding changes in working capital.

For more information, visit www.navistar.com.

Continue Reading

Business

FTR Trucking Conditions Index for July improved to reading above neutral

Published

on

FTR said although some positive trucking conditions index readings are possible over the next year, the outlook is for primarily negative to neutral readings throughout the time frame. (The Trucker file photo)

BLOOMINGTON, Ind. — FTR’s Trucking Conditions Index for July improved slightly to a just above neutral reading of 0.28.  Lower diesel prices offset the effects of lower capacity utilization pushing the reading into positive territory for the first time since January. Although some positive readings are possible over the next year, the outlook is for primarily negative to neutral readings throughout the time frame.

Details of the TCI for July are found in the September t issue of FTR’s Trucking Update, published August 30. The “Notes by the Dashboard Light” section issues readers a warning about the possibility for slower growth ahead.

Along with the TCI and “Notes by the Dashboard Light,” the Trucking Update includes data and analysis on load volumes, the capacity environment, rates, costs, and the truck driver situation.

“Although it has become common to hear dire warnings about the state of the trucking industry, the truck freight market as a whole is hardly collapsing,” said Avery Vise, vice president of trucking. “Rapid cooling from last year’s extraordinarily strong market certainly has left many weak carriers exposed, but freight volume and rates are holding up reasonably well – certainly if viewed in a longer-term context. Still, most of the near-term risks to our outlook are on the downside.”

The TCI tracks the changes representing five major conditions in the U.S. truck market, including freight volumes, freight rates, fleet capacity, fuel price and financing.

The individual metrics are combined into a single index indicating the industry’s overall health. A positive score represents good, optimistic conditions. Conversely, a negative score represents bad, pessimistic conditions. Readings near zero are consistent with a neutral operating environment, and double-digit readings (up or down) suggest significant operating changes are likely.

In addition to the monthly updates on trucking conditions, FTR offers a weekly Trucking Market Update in the State of Freight Podcast.

The weekly update, hosted by Avery Vise, covers spot market and economic indicators and major industry developments. To listen to recent episodes and download the indicators that are covered, go to www.FTRintel.com/podcast.

To learn more about FTR visit www.FTRintel.com or call 888-988-1699 or email  or email FTR@FTRintel.com.

 

 

 

 

 

 

 

 

Continue Reading

Business

Average on-highway gallon of diesel up 1.6 cents, but crude oil up 12.97%

Published

on

The average price of a gallon of on-highway diesel for the week ending September 16 was 28.1 cents lower than the comparable week in 2018. (The Trucker file photo)

WASHINGTON — The average on-highway price of a gallon of diesel rose 1.6 cents a gallon to $2.987 for the week ending September 16, according to the Energy Information Administration of the Department of Energy.

It was the first weekly increase since the week ending July 8 when the price went up 1.3 cents a gallon to $3.055.

What, if any, impact did the attack on the Saudi oil facility have on the price this week is hard to determine since the attack occurred only early last Saturday.

“Our team is keeping a close eye on the impact of the Saudi oil fire on the diesel market,” said a spokesperson for Pilot Flying J. “We have already seen the market react, but it’s too early to predict the extent of the impact. Our No. 1 priority remains getting our guests from point A to point B as quickly and conveniently as possible.”

The price of West Texas Intermediate crude rose 12.97% to $61.93 Monday.

All regions of the country increased with the exception of the Central Atlantic States (New York, Pennsylvania, Maryland, Delaware and New Jersey) where the price dropped nine tenths of a penny to $3.013.

The largest increase was in the West Coast minus California at 3 cents top $3.161. The next largest increase was 2.6 cents in the overall West Coast region (California, Arizona, Nevada, Oregon and Washington) and the Rocky Mountain states (Colorado, Utah, Wyoming, Idaho and Montana.

The price for the week ending September 16 was 28.1 cents lower than the comparable week in 2018.

For a complete list of prices by region for the past three weeks, click here.

 

Continue Reading

Trending