Canadian Heavy Truck Sales Up Strongly, Reports Researcher

DesRosiers Automotive Consultants reports big gains in heavy truck sales, but adds that many believe gains will be short-lived.

Relative to 2011, sales of heavy duty trucks (weight classes 5 through 8) were up 48.4 percent in the first quarter of 2012.

A total of 10,147 units were sold through March compared to 6,836 units during the same period last year, reports DesRosiers. Sales improvements were seen in all weight classes and among most brands, but the biggest improvements were seen in the Class 8 arena it says.

Class 8 sales rose 56.5 percent during 1Q 2012, growing from 4,535 units in 1Q 2011 to 7,098 units during the first three months of this year. All players saw volume improvements; Kenworth (+94.2%), Peterbilt (+88.7%) and Mack (+72.9%) posted the biggest gains, followed by Western Star (+67.3%), Volvo (+52.4%), Freightliner (+44.8%) and Navistar/International (+18.8%).

Class 8 trucks moved briskly in the U.S., but sales failed to match the Canadian market’s momentum. U.S. sales in the heaviest and most popular weight class were up 46.6 percent during 1Q 2012, with all participating brands showing considerable improvement over 2011.

Some industry observers believe the present sales surge may be short-lived. Long lead times of several months are common in a sector that builds most products to order, and some in the OEM and dealer communities are beginning to report above-average rates of order reduction and/or cancellation during the purchase delivery period.

However, sales in lower weight classes were similarly strong in both countries. Markets for Class 5 (+26.8% Canada; +30.3% U.S.), Class 6 (+14.6% Canada; +12.4% U.S.) and Class 7 (+58.2% Canada; +14.0% U.S.) trucks all grew well during the first months of 2012. The overall U.S. market for heavy duty trucks improved by 33.3 percent relative to 1Q 2011, with 81,473 units sold this year versus 61,113 units in 2011.

Also, the Canadian Government announced in April it will match new EPA standards regulating the greenhouse gas emissions of heavy duty trucks that are set to begin a phase-in period in 2014 and will extend through full implementation of the regulations in 2018. Past regulatory deadlines have been preceded by HD sales spikes as purchasers try to avoid the extra costs associated with regulatory compliance. Emissions equipment typically adds thousands of dollars to the purchase price of a new truck.