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Power Systems Research Sees Strong Commercial Vehicle Demand Continuing
OEM Off-Highway recently interviewed Power Systems’ Chris Fisher for their OEM Industry Update podcast. Here we present it with their permission
This week on OEM Industry Update we speak with Chris Fisher, Senior Commercial Vehicle Analyst, Power Systems Research, about the current state of the North American commercial vehicle market. He says truck demand continues to be strong and is expected to remain so through 2022 and possibly even into 2023. Inventory stocking and solid growth in single family housing are among the factors positively impacting the market.
Transcript
Welcome to the PSR PowerTALK podcast, produced by Power Systems Research.
00:13 Sarah Jensen:
Welcome to OEM Industry Update; a weekly podcast examining the latest news and technology trends impacting product development teams and the heavy-duty on and off highway equipment Industries. I’m Sarah Jensen, editor of OEM Off Highway and in this week’s episode I’ll be speaking with Chris Fisher, Senior Commercial Vehicle Analyst at Power Systems Research, about the current state of the North American commercial vehicle market. Let’s take a listen now:
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Chris Fisher Truck News – February 2021
In this episode of the PSR PowerTALK Podcast Chris Fisher, Power Systems’ Senior Commercial Vehicle Analyst, discusses the Q4 2020 global production facts and related forecasts for medium and heavy trucks.
Transcript
Welcome to PowerTALK Truck podcast February 2021. Produced by Power Systems Research, the leading supplier of global production data and forecasts to the engine power products and Components industries. Here’s today’s host, Emiliano Marzoli, Manager of Power Systems Research, European Operations.
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Truck News: Ask The Expert
Chris Fisher What changes do you see in the PSR Truck Production Index in the fourth quarter compared to the third quarter of 2020?
Overall, we are seeing stronger momentum for commercial truck orders and sales which bode well for production in Q1 2021.
Supply chain issues will impact short term production as companies are still having difficulty with staffing numbers and various virus protocols that disrupt production. These problems are expected to continue throughout at least the first half of the year.
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Trucking News: Asking The Expert
Chris Fisher What is the current state of electric vehicle technology globally as well as the U.S.?
From a medium and heavy truck perspective, electric trucks are still in the early stages of testing and it will still be a few years before we know if the current technology will be effective. Transit or city buses are much further along in the process since these are largely not for profit vehicles and have more dedicated routes that allow for more consistent recharge.
China is probably the furthest along with electric bus adoption with almost half of all medium and heavy buses produced being electric. While electrified bus adoption in North America and Europe is not nearly as strong as China, demand is increasing.
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Q4 2020 Truck Production Jumps 35%
St. Paul, MN — The Power Systems Research Truck Production Index (PSR-TPI) increased from 109 to 147, or 35%, for the three-month period ended Dec. 31, 2020, from the Q3 2020. The year-over-year (Q4 2019 to Q4 2020) gain for the PSR-TPI was 121 to 147, or 21%.
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.
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2020, A Year to Forget for MHV; 2021 Is Looking Better
Chris Fisher SUMMARY: In this article we provide a global overview on a regional basis of the medium and heavy commercial vehicle market (GVWR > 6 MT’s) along with current trends and OEM happenings in North America.
NORTH AMERICA. MHCV production in North America is expected to decline by 35% in 2020 compared to 2019. However, orders for class 8 trucks improved significantly in Q4 2020 as large fleets placed their orders for a 2021 build. This appears to signal an improvement in demand for 2021 as the market aligns itself with the expected freight level moving forward. The consumer segment was strong during the last half of the year and the industrial segment is now expected to improve, as well.
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TRATON-Navistar Merger Impacts Engine Development
Chris Fisher In November, Volkswagen’s TRATON group and Navistar announced a merger agreement in which TRATON will acquire all outstanding shares of Navistar. Previously, TRATON held 16.7% of Navistar’s common shares. The deal is valued at $3.7 billion and is expected to be finalized in mid-2021.
Navistar has been in collaboration with TRATON’s brand MAN for a number of years, primarily with regard to engine development. PSR believes additional engine offerings will be one of the primary goals to improve profitability and long-term market share improvement within the class 8 truck segment.
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Q3 2020 Power Systems Research Truck Production Index (PSR-TPI) climbs 203%
St. Paul, MN — The Power Systems Research Truck Production Index (PSR-TPI) increased from 36 to 109, or 203%, for the three-month period ended Oct. 31, 2020, from the Q2 2020. The year-over-year (Q3 2019 to Q3 2020) loss for the PSR-TPI was, 117 to 109, or 6.8%.
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.
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Bus Fleets Convert To Zero Emission Vehicles
During the past few years, many cities and states have committed to full adoption of their transit bus fleets to zero-emission vehicles. While the implementation dates vary, most are aiming to have the transition completed by 2040.
Chris Fisher Since transit buses typically have pre-defined routs and access to recharging infrastructure, they are good candidates for adoption. It also helps that this segment is not-for-profit, and a short-term payback is not required. The significant barriers to adoption appear to have been overcome.
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Trucking News: Asking The Expert
Do you expect a sharp slowdown for truck purchases in October due to the possible resurgence of the Coronavirus this fall?
Chris Fisher PSR Analysis: At this point, no. The “shock and awe” of the pandemic appears to be well behind us. During the past few months, commercial truck demand has stabilized albeit at a low level but continues to improve.
Recent surveys have indicated that trucking conditions are improving. The biggest threat to the health of the industry would be a further lockdown of the economy which would cause trucking conditions to slow but would not likely upend the market. However, we do believe it will take a further 18-36 months for the economy to return to a pre-virus level.
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