What was supposed to have a been a strong year for Class 8 truck orders has been anything but, due to economic uncertainty, questions about how tariffs will affect truck prices, and potential delays of emissions regulations.
“I’ve seen a lot of ups and downs over the years,” said Magnus Koeck, vice-president, strategy, marketing and brand management at Volvo Trucks North America. “This is quite a big downturn.”
The truck manufacturing industry is still working through a post-Covid hangover. Immediately following the pandemic demand for trucks and equipment surged and manufacturers were unable to keep up.
“After that, it has come down,” Koeck said. “It’s improving a little bit in some areas, but it’s not good enough to drive the market.”
Fleets are hanging on to their trucks longer due to all the uncertainty.
“Fleets are aging their population of units because of the uncertainty, macro-economic factors, what’s going to happen with the economy? With tariffs? Are trucks going to be more expensive? Will tariffs go away? We still don’t know all the tariffs. It’s hard to navigate as an OEM when we don’t have all the facts on the table,” Koeck explained during a market update at a Volvo Trucks press event in Greenville, S.C., this week.
The average regional haul truck is now 6.8 years old and linehaul units average an age of 6.4 years. Orders continue to be sluggish as we enter what is traditionally order season for fleets, from September through the end of the year.
The five-year order average for North America is 285,000 units and an average downturn sees orders sink to about 212,000 units.
“We are even pacing below that,” Koeck said of 2025 demand.
He referred to the fall months as “hunting season” for OEMs as fleets typically place sizeable orders for the following year. This year’s will be telling when it comes to projecting demand in 2026.
“I’d say, maybe hunting season is October to December,” he said, rather than the traditional September to December. “By mid-December we will have a very good outlook for what next year is going to bring us, but we are at a significantly lower level here when it comes to orders.”
All manufacturers have scaled back production accordingly, Koeck said, noting Volvo was among the first to do so. Dealer inventories are sufficient to meet current demand, and those trucks must be moved.
“You have trucks out there at dealers, they’re not like a French wine that gets better the older they get. It’s the contrary,” he said.
New truck registrations this year are tracking toward about 250,000 units.
“The tide will turn. The question is, when the tide will turn,” said Koeck. “We will of course have another upswing.”
And fleets can only extend their life-cycles for so long, he added.
“If you have a truck 10 years, a truck 10 years ago was significantly more expensive to operate,” he said, noting Volvo has improved fuel economy over the last decade by 17-18%, to say nothing of the rising parts and repair costs fleets incur on older equipment.
Volvo delivered about 3,700 trucks in Canada in 2024, and about 26,040 units in the U.S. It’s market share dipped in recent months, but Koeck told trucknews.com that can be attributed to the truck maker’s strength in the linehaul segment which has been hardest hit in the downturn.
He expects that market share to improve as the all-new VNL gets out in greater numbers and when the longhaul market strengthens. He is already liking what he sees in the most recent order numbers.
“These orders will eventually get registered and out there, and then we’ll see an uptick,” he said of Volvo’s market share.
Meanwhile, Volvo has seen greater success in other global markets. Koeck said it was the market leader in Greater Europe for the first time last year with 19.6% share and in Brazil it commands 23% of the market.
“But we want to be significantly stronger in the U.S. and Canada,” he added. It invested US$2 billion into the new VNL and injected US$400 million into its factories in Dublin, Va., and Hagerstown, Md., to achieve that goal.
“We aspire to grow a lot here in North America during the next business cycle,” Koeck said.
Credit: Source link
