FTR reports preliminary North American Class 8 net orders for September fell m/m 29% to 28,100 units.  September 2021 activity was down 12% y/y with Class 8 orders now totaling 453,000 units for the previous 12 months.

The fall in orders came as OEMs are managing their Q1 production slots in a variety of ways.  Some manufactures continue to enter orders in a measured fashion, filling openings as they become available. Other OEMs are rolling unmet 2021 orders into 2022 and delaying new 2022 bookings. Supply chain disruptions are now expected to persist well into 2022, and OEMs are having problems determining how many trucks they will be able to build in the first quarter of next year.

Don Ake, vice president of commercial vehicles for FTR commented, “This is a complicated, bizarre situation that OEMs have never before encountered.  There are many orders that were expected to be built in 2021 that cannot be completed due to the severe component shortages, most notedly, semiconductors. The OEMs are unsure when they can build the leftover 2021 orders and any new orders because the parts shortages are now expected to continue well into next year. They can’t schedule production because they don’t know their actual build capacity.

“The order number is not a true indicator of 2022 truck demand. There is significant pent-up demand for trucks leftover from 2021 because OEMs were limited in their output. Add to this the robust demand expected for 2022 due to sturdy freight growth. The fleets have a tremendous need for new trucks in 2022, however, the OEMs are delaying entering orders until the supply-chain situation is clearer.

“Unfortunately, the supply chain remains a huge mess. Parts and components are so constricted, as well as raw materials, it will take many months to rectify, and conditions are expected to improve gradually, over an extended period.”