Trump’s Trade War Causes Truck Makers to Drop Production
by Darren.Woon
21 hrs
Truck manufacturers are experiencing lower freight volumes and subsequently the industry is expecting heavy decline.
The U.S. manufacturing sector is experiencing a sudden decline, as truck makers lower their orders due to lower demand for freight transportation because of slower global growth and trade tensions, according to The Wall Street Journal.
The U.S. industry had one of its strongest years in 2018, yet freight rates have declined more than 20 percent since it reached a record in June 2018.
Although production for heavy trucks remains high, new purchases are declining and production rates are beginning to drop. Orders for heavy-duty models from the four largest truck makers in North America--Daimler Trucks North America LLC, Paccar Inc., Volvo Trucks USA, and Navistar International Corp.--fell nearly 80 percent in July from last year,according to market forecaster ACT Research.
“We are planning for a 2020 that is not going to be as good,” said Stuart Sleper, president of XL Specialized Trailers Inc., which assembles flatbed trailers for hauling loads such as construction equipment.
ACT Research expects the production of heavy-duty trucks to fall to about 238,000 vehicles next year, compared to the expected production of 350,000 vehicles this year.
The president of East Manufacturing Corp., Dave de Poincy, noted that cancellations are also on the rise. The truck-trailer maker’s cancellation rate has reached 8 percent compared to its typical rate below 1 percent, and they anticipate that it will fall by 20 percent by the end of this fiscal year in May. |
