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September 19, 2011 4:00 AM, EDT

August Truck Sales Soar 70.8%

Gain Nets 15,085 Class 8s, Most Since ’07
By Jonathan S. Reiskin, Associate News Editor

This story appears in the Sept. 19 print edition of Transport Topics.

Class 8 U.S. retail truck sales soared in August by 70.8% — the highest increase since 2004 — and crossed the 15,000-vehicle mark for the first time since 2007.

WardsAuto.com said in a Sept. 13 report that truck makers sold 15,085 heavy-duty vehicles last month, compared with 8,834 in August 2010. It marked the 20th straight month of year-over-year expansion.

Over the first eight months of the year, the total sales volume grew by 47.8% to 100,038 from 67,680 a year earlier.

“ ‘Better’ is the only word appropriate to describe August sales. This allows dealerships to be more profitable, but issues remain,” said Kyle Treadway, a Kenworth Trucks dealer in Salt Lake City and chairman of the American Truck Dealers.

He said he remains concerned about how inflation could affect sales and the ongoing components shortage that restricts the ability of OEMs and dealers to make sales as quickly as customers would like.

Despite his critical skepticism, Treadway said of the August result, “I’ll take it. . . . This is a moderate improvement, and that’s a good thing.”

Manufacturers are still recovering from a historic sales plunge from 2007 to 2010. The U.S. Class 8 retail volume topped 200,000 a year from 2004-06, averaging 246,666 vehicles. The resulting glut, the recession and regulatory worries combined to drive sales down to 94,798 in 2009 — the worst year since the early 1980s. Sales for 2010 were 107,152.

The last time truck sales topped 15,000 a month was March 2007, when they stood at 16,090. The last time monthly expansion was higher than 70% was March 2004, when year-over-year volume shot up by 90.4%, according to Ward’s numbers.

The Ward’s report said Freightliner led all brands in sales for the month and year to date. The original equipment manufacturer sold 4,477 big trucks, or 70.2% more than the 2,630 moved the previous August. Eight-month sales rose 43.5% to 30,884 vehicles.

International, the main brand of Navistar Inc., finished second for the month and year to date, selling 3,411 big trucks, a 29.8% improvement from the year-ago month. Cumulative sales rose 8.1% to 21,397 units.

In his company’s most recent quarterly earnings call, Navistar Chairman and CEO Daniel Ustian said he expects his North American vehicle sales to accelerate, at least through the end of his Oct. 31 fiscal year (9-12, p. 3).

ACT Research Co. data on orders suggest that August results are not a fluke. The Columbus, Ind., research firm said Sept. 6 that net orders for new North American trucks were about 20,800 (9-12, p. 3). ACT President Kenny Vieth also said there is a solid backlog of unbuilt orders to keep OEMs busy in coming months.

Less-than-truckload carrier New England Motor Freight provided an example of demand, announcing a significant tractor purchase on Sept. 13.

The Elizabeth, N.J., LTL said it just bought 57 Mack Trucks, 10 Volvo Trucks, six International Trucks and six Freightliners.

“NEMF intends to replace 100 to 150 tractors per year over the next three to four years. They will also add a minimum of 400 new trailers to their fleet over the same period,” the statement said, citing Chief Operating Officer Thomas Connery. NEMF parent the Shevell Group ranks No. 53 on the Transport Topics Top 100 list of the largest for-hire carriers in the United States and Canada.

Ward’s said the two brands of Paccar Inc. took third and fourth place, with Peterbilt Motors posting a 139.8% increase — the most of any brand — to 2,286 big trucks from 957 the previous August. Eight-month sales rose 86.6% to 14,084 units.

Kenworth Trucks had a 92.4% increase to 2,286 heavy trucks for the month from 1,060. Cumulative volume rose 91.5% to 13,059 vehicles. Spokesmen for both Paccar brands declined to comment.

Volvo Trucks took fifth place with a 109.4% jump to 1,696 big trucks from 810 the previous August. Volvo’s year-to-date volume grew by 103.1% — the highest of any brand — to 11,519 units.

Mack, also a part of Volvo Group, sold 1,022 heavy trucks for the month, a 66.7% increase from 613. Eight-month volume rose 54.4% to 7,925 units.

Mack’s historical link with the still-dormant construction industry has given the OEM a significant challenge, said spokesman John Walsh.

“Our results this year reflect a keen focus on highway truck sales and steady demand from refuse customers. The fact that our market share has remained steady despite almost no construction truck business bears that out,” Walsh said referring to customer response for the company’s 2010-compliant engines.