Jim Downey and Chris Fisher

St. Paul, MN (Janaury 23, 2023)— The Power Systems Research Truck Production Index (PSR-TPI) increased from 101 to 105, or 3.7%, for the three-month period ended Dec. 31, 2022, from Q3 2022. The year-over-year (Q4 2021 through Q4 2022) loss for the PSR-TPI was, 122 to 105, or -13.2%.

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.

Global Index. Global medium and heavy vehicle production is expected to decline by 15.8% in 2022 when final numbers are available in Q1 2023, primarily due to a significant drop in heavy truck demand in China. Global MHCV demand is expected to improve by 4.6% in 2023 even with concerns of a slowing global economy.  Ongoing supply chain disruptions along with generally higher inflation and a risk of Covid variants returning are also a concern moving forward.

All Regions. Medium and heavy commercial vehicle production will be mixed in 2022 due to a variety of issues.  In China, truck overcapacity continues to hinder demand while the Russian-Ukraine war is significantly impacting demand and production in Eastern Europe.  While the global supply chain is showing improvement, it will remain a problem in 2023 for all regions.  There is serious concern about a major slowdown in the North American and European economy as a direct result of higher fuel and energy prices and overall inflation which doesn’t appear to be going away anytime soon.

North America. Medium and heavy commercial vehicle production is expected to increase by 12.5% in 2022 over last year primarily driven by improved class 8 truck production.  While not back to pre-pandemic levels, the supply chain has seen improvement during the past few months.  Within the class 8 truck segment, PSR expects truck demand to remain strong into the first part of next year as a result of significant pent-up heavy truck demand.  While commercial vehicle demand is expected to decline slightly in 2023, production levels are expected to remain strong through at least the first half of the year. PSR

Jim Downey is Vice President – Global Data Products at Power Systems Research

Chris Fisher is the Senior Commercial Vehicle Analyst at Power Systems Research

Global Truck Production REPORT

St. Paul, MN (October 24, 2022)— The Power Systems Research Truck Production Index (PSR-TPI) dropped from 110 to 101, or 8.2%, for the three-month period ended September 30, 2022, from Q2 2022. The year-over-year (Q3 2021 to Q3 2022) loss for the PSR-TPI was, 117 to 101, or 13.7%.

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. Medium and heavy commercial vehicle production will be mixed this year due to a variety of issues.  In China, truck overcapacity continues to hinder demand while the Russian-Ukraine war is significantly impacting demand and production in Eastern Europe.  The global supply chain will remain a problem through at least the end of this year for all regions.  There is serious concern about a major slowdown in the North American and European economies as a direct result of higher fuel and energy prices and overall inflation which doesn’t appear to be going away anytime soon.

Global Index. Global medium and heavy vehicle production is expected to decline by 13% this year primarily due to a significant drop in heavy truck demand in China.  A slowing global economy along with continued supply chain disruptions will continue to place pressure on demand moving forward.

North America. Medium and heavy commercial vehicle production is expected to increase by 9.3% this year over 2021 as the OEMs continue to struggle with the supply chain disruption that is expected to continue well into next year.   Freight demand continues to remain healthy but is expected to cool as the economy in general slows down primarily due to high inflation and energy costs along with higher interest rates and continued disruption within the overall supply chain.  Within the class 8 truck segment, PSR expects truck demand to remain strong into the first part of next year as a result of significant pent-up heavy truck demand.  PSR

Jim Downey is Vice President – Global Data Products at Power Systems Research and
Chris Fisher is Senior Commercial Vehicle Analyst at Power Systems Research

ST. PAUL, MN — The year-over-year (Q1 2021 to Q1 2022) Power Systems Research Truck Production Index (PSR-TPI) dropped 114 to 109, or 4.4%. For the three-month period ended March 31, 2022, Q1 2022, the TPI decreased 9.2%, declining from 120 to 109.

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. PSR

St. Paul, MN (January 25, 2022)— The Power Systems Research Truck Production Index (PSR-TPI) increased from 116 to 120, or 3.4%, for the three-month period ended December 31, 2021, from Q3 2021. The year-over-year (Q4 2020 to Q4 2021) loss for the PSR-TPI was, 190 to 120, or -37%.

The PSR-TPI measures truck production globally and across six regions: North America, China, Europe, South America, Japan and Korea and Emerging Markets.

This data comes from OE Link™, the proprietary database maintained by Power Systems Research.

Global Index: We expect global production volumes in 2022 to gain 3.7% vs 2021, with a positive trend in all regions, except for China, where we expect production volumes to be down -3.6% in 2022 vs 2021.  China experienced a surge in demand during 2020 due to the change in emissions regulations, so 2021 was down significantly, about 20%. 

All Regions: Global demand for Medium and Heavy Commercial Vehicles (MHV) rebounded in 2021 but overall growth in the segment was flat.  Going forward, we expect the growth to accelerate in 2022 and 2023.   The exceptions to this rebound trend are in China and India, which continue to decline and sharply drive overall global production numbers into negative territory. 

North America: While supply chain disruptions continue to negatively impact the commercial vehicle market, medium and heavy commercial vehicle production is expected to finish 2021 15.8% higher than 2020.  The forecasted production growth rate is expected to continue to show improvement through 2023 as supply chain disruptions ease and truck capacity in the market begins to align with demand.  The disruption in the supply chain and on-going issues with COVID will continue to impact the market in 2022.

Europe: Medium and heavy truck production is expected to finish up 17% over 2020.  While the truck segment showed solid improvement over a low production base in 2020, bus demand was still soft in 2021.  In 2022, production is expected to grow by 8% and continue to improve through 2024.  However, continued supply chain disruptions and possible negative impacts from COVID will likely continue through much of 2022.

South Asia: Medium and heavy commercial vehicle production in India is expected to finish 2021 at about 287,000 vehicles, an increase of 70% over 2020. Slight demand growth in India is expected in 2022 and 2023 before declining in 2024 partially due to it being an election year. In India, the focus is moving toward more infrastructure spending which is good for the vocational market. However, increasing use of rail freight, worker shortages and increasing commodity prices will slow truck demand during the next few years.

South America: Medium and heavy commercial vehicle production is expected to increase by 55.6% in 2021 over 2020, and production is expected to further increase by 10.4% in 2022 over 2021.  Continued supply chain disruptions along with uncertainty regarding the Omicron COVID variant will likely impact the market throughout the year.

Japan/Korea: Medium and heavy commercial vehicle production in Japan and South Korea is expected to increase by 16.7% in 2021 over 2020.  In 2022, production levels for the region are expected to grow by 4.7% over 2021.  Automotive production in Japan is starting to see improvement with strong gains over October and November.  While this is good news, the supply chain issues have yet to be resolved and the Omicron COVID variant will likely pose challenges throughout the year.  Component costs are expected to rise this year because of supplier’s air freighting parts that they are unable to ship by sea.

Greater China: The medium and heavy commercial vehicle market declined by approximately 20% in 2021 over 2020 partially due to a truck pre-buy ahead of the China VI emission standard implementation in July 2021.  The cost of the emission technology for China VI vehicles are not offset with any significant improvement in fuel economy.  In 2022, the market will still be unstable as the covid virus continues to impact the economy.  Demand is expected to decline slightly through 2023 before a slow recovery in 2024.  

The next update of the Power Systems Research TPI will be in April 2022 and will reflect changes in the TPI during Q1 2022.  PSR

Jim Downey is Vice President – Global Data Products at Power Systems Research and Chris Fisher is Senior Commercial Vehicle Analyst at Power Systems Research.

The Q3 2021 Power Systems Research Truck Production Index (PSR-TPI) declined 10.7% in the third quarter ended Sept. 30, 2021, from Q2 2021. At the same time, the index dropped 17% on a YoY basis.

Except for China, all regions are expected to experience solid commercial vehicle demand growth this year and into 2022.  Chinese heavy truck demand is expected to decline this year primarily due to the implementation of the China VI emission regulations that adds cost to the vehicles but no significant improvement in fuel economy.

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.

Global Index. Overall, medium, and heavy truck demand will finish the year on a strong note and continued strength is expected into 2022.  On-going supply chain disruptions will continue to impact production throughout the rest of the year and well into 2022.

North America. While freight demand continues to be strong particularly in the consumer segment, the continued worker shortage along with on-going supply chain disruptions are hurting vehicle production across all segments.  The production disruptions are expected to continue well into 2022.  While the overall economy is expected to remain strong through next year, rising inflation will continue to be a concern moving forward.

Europe. During the first six months of the year, European medium and heavy commercial truck registrations improved by 33.1% compared to the same period in 2020.  While truck order bookings remain strong, Europe is facing the same problems as other regions with various supply chain disruptions.  Most OEMs have been forced to scale back production due to a lack of components most notably, semi-conductor chips.

Greater China. Heavy truck demand during the first half of the year was strong primarily due to a truck pre-buy ahead of the China VI emission standard implementation in July 2021.  The costs of the emission technology for China VI vehicles are not offset with any significant improvement in fuel economy.  Medium and heavy commercial vehicle production is expected to decline by 21% this year over 2020 before bottoming out in 2022.

South Asia. Medium and heavy commercial vehicle production in India is expected to reach 265,000 vehicles in 2021 which is an increase of 63% over last year. Slight demand growth in India is expected in 2022 and 2023 before declining in 2024 partially due to it being an election year.  In India, the focus is moving toward more infrastructure spending which is good for the vocational market.  However, increasing use of rail freight, worker shortages and increasing commodity prices will likely slow truck demand during the next few years.

Japan/Korea. Medium and heavy commercial vehicle production in Japan and South Korea is expected to increase by 18% this year over 2020.  South Korean production is expected to increase by 24% this year and Japanese production is forecasted to improve by 17%.  Earlier in the year, Japan was hit particularly hard by supply chain disruptions. 

South America. Medium and heavy commercial vehicle production is expected to increase by 48.8% this year over 2020 with truck production improving by 57.5%.  Increased vaccinations and an overall improving regional and global economy are driving the growth in vehicle demand.  However, continued supply chain disruptions are negatively impacting production and this trend is expected to continue throughout the remainder of the year.   

The next update of the Power Systems Research TPI will be in January 2022 and will reflect changes in the TPI during Q4 2021. 

Power Systems Research has been tracking the production of engines and their use around the world for 45 years. We’re the leading company in the world doing this research and building these databases.

We have many of the largest companies in the world as our customers, including John Deere and Caterpillar. They subscribe to our unique databases, and their facilities around the world access our data and forecasts through the internet 24/7.

We’re based in St. Paul, Minnesota, and we have offices and analysts located around the world, from Brussels to Beijing and Tokyo to Brazil, to help us collect and analyze this data.

For information on our products and services, call +1 651-905-8400 or email us at info@powersys.com. Learn more about Power Systems Research at www.powersys.com.   PSR

Jim Downey is vice president – global data products at Power Systems Research and Chris Fisher is the senior commercial vehicle analyst at Power Systems Research

St. Paul, MN (July 12, 2021)— The Power Systems Research Truck Production Index (PSR-TPI) increased 193.5% year-over-year (Q2 2020 to the Q2 2021), moving from 46 to 135. For the three-month period ended June 30, 2021, (Q1 2021 to Q2 2021) the TPI climbed 15.4%, increasing from 117 to 135.

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.

Global Index. Overall, medium and heavy truck demand will finish the year on a strong note and continued strength is expected into 2022.  On-going supply chain disruptions will continue to impact production throughout the rest of the year and possibly into 2022.

All Regions. Except for China, all regions are expected to experience solid commercial vehicle demand growth this year and into 2022.  Chinese heavy truck demand is expected to decline this year primarily due to the implementation of the China VI emission regulations that adds cost to the vehicles but no significant improvement in fuel economy.

North America. In the United States, freight demand remains extremely strong and freight rates very high primarily due to high levels of consumer spending and the overall strong economy. 

While the demand side is very strong the supply side is where the issues lie concerning medium and heavy truck production.  The on-going issues with the supply chain are expected to continue for the remainder of the year and possibly into 2022 as OEM’s continue to have difficulty sourcing various components such as semi-conductors. 

While the 2021 class 8 truck order boards are mostly filled and orders for next year are also expected to be strong, there are some concerns surrounding higher levels of inflation.  On-going supply chain disruptions, worker shortages and possible negative effects from high levels of government spending could fuel higher inflation moving forward.

Europe. During the first four months of the year, European medium and heavy commercial truck registrations improved by 28.5% compared to the same period in 2020.  Order bookings remain strong primarily due to an improved economy.  However, Europe is facing the same problems as other regions with various supply chain disruptions.  While sourcing of semi-conductors continues to be a problem, the EU’s proposal to extend the restriction on steel imports into Europe remains a point of concern.  While most of the steel is sourced in the EU, imports are needed to fill in the gaps especially during periods of high vehicle demand.

South Asia. Medium and heavy commercial vehicle production in India is expected to reach 261,000 vehicles in 2021 which is an increase of 55% over last year. Moderate growth is also expected in 2022 and 2023 before declining in 2024 partially due to it being an election year.  The medium and heavy truck segment will continue to face headwinds due to excess capacity in the market, increased rail freight usage, relative constant freight rate and booming fuel prices. Further, we are witnessing a change in product dynamics–the share of higher tonnage vehicles is rising. Because of this trend, fewer trucks will be needed to haul the same amount of freight. 

South America. Medium and heavy commercial vehicle production is expected to increase by 36% this year over 2020 with truck production improving by 41%.  Increased vaccinations and an overall improving regional and global economy are driving the growth in vehicle demand.  However, continued supply chain disruptions are negatively impacting production and this trend is expected to continue throughout the remainder of the year.

Japan/Korea. Medium and heavy commercial vehicle production in Japan and South Korea is expected to increase by 16% this year over 2020.  While South Korean production is expected to increase by 28% this year, Japan production continues to lag and is expected to improve by 14.8%.  Japan has been hit particularly hard by the supply chain disruption.  PSR expects continued volatility in this region throughout the remainder of the year.

Greater China. Heavy truck demand during the first half of the year was strong primarily due to a truck pre-buy ahead of the China VI emission standard implementation in July 2021.  The cost of the emission technology for China VI vehicles is not offset with any significant improvement in fuel economy.   The Heavy truck growth rate changed from positive in April to negative in May.  Also, in May, the inventory of heavy trucks exceeded 300,000 units. Considering that June to July is the off-season, the short-term heavy truck sales are expected to experience downward pressure.  The industry is currently expecting production of heavy trucks to be approximately 1.4 million which is a decrease of 14% compared with 2020.

The next update of the Power Systems Research TPI will be in October 2021 and will reflect changes in the TPI during Q3 2021.  PSR

Chris Fisher is the senior commercial vehicle analyst at Power Systems Research

Jim Downey is vice president – global data products at Power Systems Research