ACT Research said the latest release of its North American Commercial Vehicle Outlook, forecasts for 2020 were marked up across the board in July. The report cites the uptick as a result of the impact of nearly $6 trillion in stimulus to date, better-than-expected economic activity in June, freight rates boosted by a driver shortfall that was created by massive layoffs and extended unemployment benefits, and preliminary June metrics that were well above trend.
“COVID-19 continues to impact the CV industry, as well as the US and global economies, but we do not believe state-level closures are likely from here,” said Kenny Vieth, ACT’s president and senior analyst. “That said, the raging case counts in Sunbelt states raise the risk of supply-chain disruptions, if any of the heavily-impacted states are shuttered for several weeks, as too much July 4th weekend fun is expected to drive a case surge into the end of the month.” Vieth said. “A vaccine is seen as the key to unlocking a more broad-based recovery, as the simplest human interactions will no longer have to be weighed and justified.”
Regarding the US transportation industry specifically, Vieth said, “even as the economy works to regain its footing post-COVID and pre-vaccine, freight markets should be somewhat less impacted because, while we can choose not to go to restaurants, not eating is not an option. Most freight is related to society’s most basic needs: food, shelter, clothes, transportation.”
Regarding NA commercial vehicle demand, Vieth said, “combined with the OEMs and their supply base pushing hard to restore material and assembly flows, underlying economics do not appear to be as punitive as initially estimated. Additionally, spot freight rates, sitting at the intersection of equipment supply and freight demand, are the leading indicator of heavy CV demand cycles. Because of these factors, we’re seeing stronger and sooner production increases.”
Additionally, ACT Research has created an easily accessible COVID-19 Market Watch webpage to track noteworthy high frequency macroeconomic and transportation-specific market indicators, which can be found at https://pages.actresearch.net/covid-19
The N.A. CV Outlook is a report that forecasts the future of the industry, looking at the next 1 to 5 years, with the objective of giving OEMs, Tier 1 and Tier 2 suppliers, and investment firms the information needed to plan accordingly.
The report provides an overview of the North American markets, as well as looking at relevant, current market activity to highlight orders, production, and backlogs, shedding light on the forecast. Information included in this report covers forecasts and current market conditions for medium and heavy-duty trucks/tractors, and trailers, the macroeconomies of the US, Canada, and Mexico, publicly-traded carrier information, oil and fuel price impacts, freight and intermodal considerations, and regulatory environment impacts.
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