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Strict EV Mandates Could Implode Economy
Chris Fisher Testifying before a Senate subcommittee on transportation technology recently, American Trucking Associations (ATA) President and CEO Chris Spear lobbed criticism at the California Air Resources Board (CARB), blasting its regulatory framework as economically unworkable and completely detached from operational reality.
“California Air Resources Board does not sit down with our industry,” Spear told lawmakers. “They don’t care what our industry has to say. Their attitude is: ‘You’ll figure it out.'”
The trucking industry narrowly avoided being the epicenter of what Spear characterized as an economic collapse when the Trump administration last year spiked the California Truck Emission Standards (CARB’s Omnibus rule) and California Truck NOx Emission Standards (CARB’s Advanced Clean Trucks regulations), respectively. California withdrew its waiver request in January 2025 to implement its Advanced Clean Fleets rule, which would have effectively mandated electric trucks in the state.
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Q1 2026 Truck Production Index Falls 4.2%
Sign-up for TPI ReportsSt. Paul, MN —The Power Systems Research Truck Production Index (PSR-TPI) decreased from 119 to 114, or -4.2%, for the three-month period ending March 31, 2026, from Q4 2025. The year-over-year (Q1 2025 to Q1 2026) gain for the PSR-TPI was, 113 to 114, or 0.9%. The PSR-TPI measures truck production globally and across six regions: North America, China, Europe, South America, Japan & Korea and Emerging Markets. This data comes from OE Link™, the proprietary database maintained by Power Systems Research.
All Regions. MHCV demand will vary by region in 2026. North America and European vehicle demand is expected to improve somewhat over last year; China is expected to see a single digit decline in production. Much of the decline comes on the heels of very high levels of production in 2025.
Global Index. Overall, global production is expected to decline slightly in 2026 over last year. Ongoing tariffs along with the conflict in the Middle East and the shipping disruption in the Strait of Hormuz are putting pressure on truck demand this year.
Chris Fisher North America. Medium and heavy truck production in North America is expected to increase by 9.4% this year compared with low 2025 production. While class 8 truck production is expected to increase by 11.3% this year as order rates for class 8 trucks improved strongly from December – March. Improvement in freight rates and freight demand along with tightening truck capacity and some level of truck pre-buy ahead of the 2027 GHG emission regulations is expected to drive increased truck production this year. However, a protracted conflict in the Middle East would put significant downside pressure on truck demand primarily due to higher fuel cost, supply chain disruptions and an overall concern about the state of the economy moving forward throughout the year. PSR
By Jim Downey is Vice President-Global Data Products at Power Systems Research
Chris Fisher is Senior Commercial Vehicle Analyst at Power Systems Research -
Mack Says MP13 Engine Is EPA ’27 Compliant
Chris Fisher Mack Trucks said at the ACT Expo in Las Vegas its MP13 powertrain has been re-engineered to meet stringent EPA 2027 emissions standards while also getting a performance boost for both highway and vocational applications.
The new MP13 will deliver up to 540 horsepower and 1,950 lb.-ft. of torque, but beyond raw power, the engine increases braking horsepower by more than 20%, reaching 630 braking hp for improved stopping capability.
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2026 Global MHCV Production Increases Seen
Chris Fisher Global medium and heavy truck production is expected to increase in most important regions this year, but China’s MH truck segment probably will see a major structural change. Overall production in South America is expected to be flat, although Argentina is likely to post a gain of almost 10%.
North America. Medium and heavy truck production in North America is expected to increase by 9.4% this year compared with low 2025 production. While class 8 truck production is expected to increase by 11.3% this year as order rates for class 8 trucks improved strongly from December – March.
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Strait of Hormuz Closure May Tip Global Economy
Chris Fisher Americans are warily eyeing prices at the pump as oil shipments through the Strait of Hormuz grind to a halt amid the threat of Iranian attacks on vessels. The IEA took the unprecedented step of saying it would release 400 million barrels of oil from reserve on Wednesday. But oil is far from the only product for which the world economy is heavily dependent on the shallow, narrow waterway which connects Persian Gulf ports with the rest of the world. From the metals market to agriculture and autos, a de facto closure of the strait would ripple through business sectors and both the U.S. and world economy.
Aluminum is a good example. It is one of the biggest non-petroleum commerce casualties of the U.S.-Iran war. In 2025, the Middle East accounted for roughly 21% of unwrought aluminum imports and 13% of wrought aluminum imports — and those percentages have been rising. Unwrought aluminum is the raw, unprocessed metal in forms like ingots and billets, while wrought aluminum has been mechanically shaped into sheets, rods, or other finished forms used directly in manufacturing.
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Q4 2025 Truck Production Climbs 3.7%
Sign-up for TPI ReportsThe Power Systems Research Truck Production Index (PSR-TPI) increased from 107 to 111, or 3.7%, for the three-month period ended Dec. 31, 2025, from Q3 2025. The year over-year (Q4 2024 to Q4 2025) loss for the PSR-TPI was, 113 to 111, or -1.8%.
The PSR-TPI measures truck production globally and across six regions: North America, China, Europe, South America, Japan & Korea and Emerging Markets. This data comes from OE Link,™, the proprietary database maintained by Power Systems Research.
All Regions. In 2026, all regions are expected to see some level of improvement in the MHCV segment. After low levels of production in Europe and North America in 2025, a slight increase in demand in 2026 is expected as both regions recover and should see stronger demand in 2027 and 2028. All other regions are expected to see improvement as well.
Global. Globally, medium and heavy commercial vehicle production is expected to decline by 3.7% this year over 2025. A moderate softening of the global economy along with negative impacts from increased tariffs had placed pressure on vehicle demand last year but market conditions are stabilizing heading into 2026. PSR
Jim Downey is Vice President, Global Data Products, at Power Systems Research
Chris Fisher is Senior Commercial Vehicle Analyst at Power Systems Research -
Tesla Semi Lines Up for $165M in California Incentives
Chris Fisher The update was initially reported by The Los Angeles Times.
Tesla reportedly is positioned to receive roughly $165 million in California clean-truck incentives for its Semi.
As per the Times, the Tesla Semi’s funding will come from California’s Hybrid and Zero-Emission Truck and Bus Incentive Project (HVIP), which was designed to accelerate the adoption of cleaner medium- and heavy-duty vehicles. Since its launch in 2009, the HVIP has distributed more than $1.6 billion to support zero-emission trucks and buses across the state.
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2026 Growth of 4.9% Seen in Truck Production
Chris Fisher Medium and heavy truck production in North America is expected to increase by 4.9% this year compared with 2025. While class 8 truck production is expected to increase by 6.1% this year, the industry continues to be negatively impacted by the weight of the tariffs, low freight demand, excess truck capacity and relatively high finance rates which is expected to continue through at least the first half of the year.
With regard to the implementation of the phase 3 GHG emission regulations, it will be later in the spring before the EPA finalizes any revisions to the standards. Many in the industry believe the EPA will retain the 0.035 g/hp-hr standard along with the 2027 implementation date but cancel the extended warranty requirements which would have added significant up-front cost to the trucks.
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EPA Won’t Delay 2027 NOx Rule, Plans Changes
Chris Fisher The U.S. Environmental Protection Agency is moving forward with the 2027 timeline for its heavy-duty NOx rule—currently set to take effect with the 2027 model year—but says changes are in store.
The American Trucking Associations (ATA), National Tank Truck Carriers, Truckload Carriers Association, and 49 state trucking associations in August penned a letter to EPA, asking the regulator to push implementation to 2031, citing “substantial compliance costs and operational burdens at a time when the trucking industry is already contending with historically difficult market conditions.”
Administrator Lee Zeldin in March announced that the EPA was reevaluating the Biden-era 2022 Heavy-Duty Engine and Vehicle rule that regulates oxides of nitrogen (NOx) and other emissions beginning with Model Year 2027.
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