With 2024 orderboards open, fleets placed the highest number of Class 8 bookings this year in September. But they know they can pull the plug if necessary.

Preliminary Class 8 net orders were 36,800 units, up 67% over August, ACT Research reported. Rival analytics firm FTR Transportation Intelligence pegged orders at 31,200. Both numbers fell far short of the record 53,700 orders in September 2022.

With depressed spot rates and a cooling consumer economy, some of the orders could be a hedge against tougher environmental standards that take effect for heavy-duty trucks in 2025 in California. Trucks ordered now and built before the standards take effect are grandfathered into a fleet’s allowable percentage of diesel trucks.

Other orders are consistent with the beginning of the fall order season, when fleets book how many trucks they expect to need to replace older iron. Manufacturers allow order cancellations until they purchase materials to build the trucks. So, occupying build slots is ultimately a flexible hedge for the largest fleets.

“Although a large increase in September was expected due to available build slots, it is still a positive indicator for the industry,” FTR Chairman Eric Starks said.

‘Willing to order new equipment’

“Despite the weakness in the overall freight market, fleets continue to be willing to order new equipment. We did not anticipate matching the level of orders that we saw this time last year, but increasing orders confirm our expectations of replacement demand in 2024,” Starks said.

Slow orders during the summer months allowed OEMs to work down backlogs that once stretched to nine months from order to delivery. That gap is now closer to the historic six-month wait for a new truck. Supply chain disruptions that plagued the industry for nearly two years during and after the pandemic have largely subsided.

“One thing we did know was that nearly all the August-ending Class 8 backlog was scheduled for build in 2023, so strong orders are imperative for the industry to maintain current strong production rates very far into 2024,” said Kenny Vieth, ACT Research president and senior analyst.

Class 8 used truck prices at or below 2018

The connection between new truck orders and production ultimately trickles down to prices for used trucks.

“For the first time since the pandemic bubble began, Class 8 retail and auction selling prices are at or below 2018 levels in both nominal and real figures,” Chris Visser, director of specialty vehicles at J.D. Power Valuation Services said. “Substantial numbers of off-lease trucks — most with high mileage and basic specs — continue to cycle through the market.”

Similar conditions are expected through the end of the year as OEMs deliver new trucks at a faster pace than they were able for much of the past two years. Five of the seven major truck makers saw sales rise year over year in August, the most recent month for which Ward’s Intelligence data is available.

Related articles:

August Class 8 truck orders reach highest level since February

July Class 8 orders rise but still trail replacement demand

Class 8 truck orders set monthly record for September (2022)

Click for more FreightWaves articles by Alan Adler.