Volvo anticipating further decline in Class 8 truck market
LAURENS, S.C. – Volvo Trucks is projecting North American Class 8 truck sales are going to get worse before they get better. Magnus Koeck, vice-president of marketing and brand management, told the truck press Monday that Volvo is predicting a total North American Class 8 market of 215,000 units for 2017. That’s down from the 240,000 that will be sold this year and way off 2015’s mark of more than 300,000 units.
“We believe it’s going to continue to decline a bit going into next year,” Koeck said. “We have a lot of inventory for the industry out there at the dealers. When the market came to a halt in June and July of last year, OEMs, including ourselves, continued to produce trucks in our factories as if nothing has happened and eventually that became a lot of trucks at dealers and that’s, I’d say, the major impact that we can see now for new orders for the industry.” Dealer inventories are being reduced, Koeck said, but they will still be a factor into next year.
The inventory glut has been exacerbated by a slowdown in freight volumes. The reduced order intake is especially acute in the long-haul segment, which is down about 35-40% and regional haul, down about 32%, and these are the two segments in which Volvo is strongest, Koeck pointed out. The construction segment is up about 3-4% this year.
This is a trend that could continue. Koeck said the expansion of the Panama Canal will bring more freight to the eastern seaboard, which could be a boon for regional trucking. And the industry’s inability to find linehaul drivers will also drive the regionalization of trucking.
Koeck said longhaul’s share of the Class 8 market could fall from about 50% today to 43% of the total market while regional haul increases its share from about 27% today to about 35%. Natural gas today comprises just 2% of the US market and Koeck said he doesn’t expect that to change in the near future. Koeck made the comments prior to Volvo’s Safety Symposium, where it demonstrated safety systems such as Volvo Enhanced Stability Technology and its new Volvo Active Driver Assist.
More than 100 customer and dealers were invited to attend.