Medium-Duty Sales Rise for 38th Straight Month

This story appears in the Feb. 25 print edition of Transport Topics.

Medium-duty U.S. retail truck sales rose 13.6% in January above the same month in 2012, the 38th consecutive month of improvement, WardsAuto.com said.

The combined volume for Classes 4-7 was 11,763, up from 10,352 the previous January. All three major weight groupings posted year-over-year sales gains, with Class 6 growing most robustly, by 31%.

“Overall, we saw strength last year in the market and see it getting stronger this year because of the improvement in the construction industry and home building. . . . We anticipate a good year in 2013 and 2014, too,” said Len Deluca, director of the Ford Motor Co. commercial truck division.

The growth in medium-duty sales stands in contrast with the heavy-duty sector, where U.S. retail sales have been declining year-over-year since September. Class 4-7 sales last declined in November 2009.

Freightliner Trucks reported improvement in Class 6 sales, but David Hames, a general manager for parent Daimler Trucks North America, said his company did well “in spite of the economic uncertainty and lower overall industry order intake.”

Overall, Class 6 sales soared to 3,936 units from 3,004 the previous January. Freightliner kept its market-share lead in the gross-vehicle-weight rating class that has the largest vehicles that do not require the operator to have a commercial driver license. Its sales jumped 42.3% to 1,886 units from 1,325.

The Feb. 12 report from Ward’s said Ford’s Class 6 sales leapt to 894 units, or 6.3 times the 141 trucks sold in the previous January. Ford rose to second place for the month in Class 6 from fourth in the year-ago month.

Navistar Inc. dropped to third place from second as its monthly tally declined 31.6% to 822 trucks from 1,201.

Ford’s Deluca attributed the company’s success, in part, to its V-10, 6.8-liter gasoline engine, which costs $8,300 less than the same vehicle with a diesel engine. He said tree-service companies and municipal governments have been very interested in the large gas engine and that towing companies are looking, too.

The Ford gasoline engine also can be altered on an aftermarket basis to use natural gas, the company said.

Ford sells the Class 6 vehicles as chassis with cabs and engines, which then go to upfitters that attach truck bodies.

In 2012, Class 6 sales contracted for the year, dipping by 1.7% from 2011, Ward’s said. However, they did grow in December by 4.7%.

The Ford result was a sharp break from recent history in the Ward’s reports. For the first 11 months of 2012, Ford sold an average of 267.4 Class 6 vehicles per month, including 295 in November, before leaping to 870 in December and 894 last month.

Deluca said year-end vehicle purchases for tax purposes always create a spike, and some of those final deliveries might not have been made until January of this year because the bodies that get attached to chassis are often “elaborate” and difficult.

Among the other segments, Class 7 monthly sales grew by 5.9% to 3,780 trucks from 3,568 in January 2012. The two largest brand names were Freightliner, with 49.4% of monthly sales, and Navistar International, with 28.1%.

The Class 7 volume has grown in 11 of the past 12 months, with August the sole exception.

Classes 4 and 5, combined, grew by 7.1% to 4,047 trucks from 3,780 in the year-ago month. Ford controlled the recent month with 66.3% of sales. Isuzu Trucks was second with 16.4% of Class 4/5. Six other manufacturers split the remaining 17.2%.

Class 4/5 sales have grown in each of the past 12 months.

Ford’s Deluca emphasized the importance of the housing industry in leading to improved truck sales.

“Through mid-2008 and into 2009, housing fell off drastically and so did our business, but now it’s recovering. Construction and housing, that’s the customer,” Deluca said.

According to Census Bureau data, U.S. housing starts hit bottom in April 2009 at an annual rate of 478,000, down from a peak of 2.27 million units during March 2006.

By February 2011, the rate was still only 518,000 starts a year, but in the two years since then, it has grown to 954,000 starts by December 2012 — the highest level in four years.