This Is French To Me, Layman's Language PLEASE?

Topic 11689 | Page 1

Page 1 of 1
Serah D.'s Comment
member avatar

Home There Go The Truckers: Unprecedented 59% Plunge In November Heavy Truck Orders Tyler Durden's pictureSubmitted by Tyler Durden on 12/03/2015 12:32 -0500

Recession Wells Fargo

inShare 7 The rout beneath the relative calm of the market surface continues today as another sector has gotten crushed today in reaction to the domestic and global collapse in trade, the spreading domestic manufacturing recession and the bursting of the commodity bubble: truckers, and especially the heaviest, Class 8 trucks, those with a gross weight over 33K pounds, those which make up the backbone of U.S. trade infrastructure and logistics.

Such as this Kenworth W900:

The following charts of Wabco and Paccar show just where the pain is most acute today:

(Sorry, unable to copy the charts )

What happened? Nothing short of a complete disintegration in the heavy trucking sector. Wells Fargo explains:

November Class 5-8 orders decreased 40% yr/yr and 26% from October. The yr/yr decline was the eighth consecutive month of Class 5-8 contraction. The decline yr/yr was driven by weaker Class 8 order intake. Class 8 orders of 16,600 were below our channel check based 22,000-25,000 expectation, dropped 59% yr/yr and 36% from October (vs. the ten-year average 7% decrease in November from October), and was the weakest order month on a seasonally adjusted basis since August 2010. Clearly, November Class 8 orders slowed to weak levels and were beneath expectations. We estimate the Class 8 order intake translates into a Class 8 backlog decline of about 6-8% from October and 15-18% yr/yr. Further, we estimate that backlog to inventory fell to 1.6-1.7 from October’s 1.82 and remained beneath 2 for the third consecutive month. Fundamentals appear to be progressively negative for future production trends, especially combining the sub-2 backlog to inventory ratio with a low likelihood for significant near-term order increase, given issues that tend to weigh on orders are becoming more prevalent according to our channel check (i.e., shorter order to delivery lead times and decreased used equipment pricing impact on trade-in values). We believe the Class 8 orders will be a negative surprise to investors and likely weigh on truck equipment related stocks.

And the punchline:

Class 8: Class 8 orders dropped 59% yr/yr to 16,600 and decreased 36% from October. The November orders were beneath our channel check based 22,000-25,000 unit forecast range and also below seasonal trends (below the ten-year average 7% decrease in November from October). This will likely disappoint some investors.

Visually, here is how the biggest collapse since the great recession looked like:

(Another chart)

Which is very bad news for these guys, who incidentally have been one of the few bright spots of hiring in the otherwise moribund US jobs market...

... and not just because robo-truck drivers are coming for their jobs.

SAP:

Substance Abuse Professional

The Substance Abuse Professional (SAP) is a person who evaluates employees who have violated a DOT drug and alcohol program regulation and makes recommendations concerning education, treatment, follow-up testing, and aftercare.

BMI:

Body mass index (BMI)

BMI is a formula that uses weight and height to estimate body fat. For most people, BMI provides a reasonable estimate of body fat. The BMI's biggest weakness is that it doesn't consider individual factors such as bone or muscle mass. BMI may:

  • Underestimate body fat for older adults or other people with low muscle mass
  • Overestimate body fat for people who are very muscular and physically fit

It's quite common, especially for men, to fall into the "overweight" category if you happen to be stronger than average. If you're pretty strong but in good shape then pay no attention.

HOS:

Hours Of Service

HOS refers to the logbook hours of service regulations.

OWI:

Operating While Intoxicated

Serah D.'s Comment
member avatar

Unfortunately l cannot edit the above. Copied from There Go The Truckers: Unprecedented 59% Plunge In November Heavy Truck Orders. You can also see the charts if you go to that website.

Thought that during this time orders increase!!!

Brett Aquila's Comment
member avatar

That report is saying that the number of new trucks ordered by the trucking industry declined heavily in recent months when compared to this time last year. But if you look at the chart it shows that last year there was a tremendous jump in new truck orders near the end of 2014. So this decline we're experiencing is really just the industry reverting to a more normal level of purchasing. The dashed red line shows the normal trendline where we're basically at now.

class 8 trucks net orders by year graph

The global economy is not very strong right now and it's showing some kinda scary signs of getting worse for awhile. But this article is really for investors trading transportation stocks on the market.

OWI:

Operating While Intoxicated

Serah D.'s Comment
member avatar

That report is saying that the number of new trucks ordered by the trucking industry declined heavily in recent months when compared to this time last year. But if you look at the chart it shows that last year there was a tremendous jump in new truck orders near the end of 2014. So this decline we're experiencing is really just the industry reverting to a more normal level of purchasing. The dashed red line shows the normal trendline where we're basically at now.

20151203_Truck2.jpg

The global economy is not very strong right now and it's showing some kinda scary signs of getting worse for awhile. But this article is really for investors trading transportation stocks on the market.

PHEW!!!!! Thanks Brett. For a minute there I thought I will have to give up my dream!!

OWI:

Operating While Intoxicated

Errol V.'s Comment
member avatar

TYLER DURDEN get in here! You've got some explaining to do! Did you really write all those articles?!

HOS:

Hours Of Service

HOS refers to the logbook hours of service regulations.
Bud A.'s Comment
member avatar

TYLER DURDEN get in here! You've got some explaining to do! Did you really write all those articles?!

Ha ha, I've got a few internet accounts with that name too! There are many Tyler Durdens in this world. Yes, we really did write those articles, and thousands more. Only in death are we no longer part of Project Mayhem.

HOS:

Hours Of Service

HOS refers to the logbook hours of service regulations.
Page 1 of 1

New Reply:

New! Check out our help videos for a better understanding of our forum features

Bold
Italic
Underline
Quote
Photo
Link
Smiley
Links On TruckingTruth


example: TruckingTruth Homepage



example: https://www.truckingtruth.com
Submit
Cancel
Upload New Photo
Please enter a caption of one sentence or less:

Click on any of the buttons below to insert a link to that section of TruckingTruth:

Getting Started In Trucking High Road Training Program Company-Sponsored Training Programs Apply For Company-Sponsored Training Truck Driver's Career Guide Choosing A School Choosing A Company Truck Driving Schools Truck Driving Jobs Apply For Truck Driving Jobs DOT Physical Drug Testing Items To Pack Pre-Hire Letters CDL Practice Tests Trucking Company Reviews Brett's Book Leasing A Truck Pre-Trip Inspection Learn The Logbook Rules Sleep Apnea
Done
Done

0 characters so far - 5,500 maximum allowed.
Submit Preview

Preview:

Submit
Cancel

Why Join Trucking Truth?

We have an awesome set of tools that will help you understand the trucking industry and prepare for a great start to your trucking career. Not only that, but everything we offer here at TruckingTruth is 100% free - no strings attached! Sign up now and get instant access to our member's section:
High Road Training Program Logo
  • The High Road Training Program
  • The High Road Article Series
  • The Friendliest Trucker's Forum Ever!
  • Email Updates When New Articles Are Posted

Apply For Paid CDL Training Through TruckingTruth

Did you know you can fill out one quick form here on TruckingTruth and apply to several companies at once for paid CDL training? Seriously! The application only takes one minute. You will speak with recruiters today. There is no obligation whatsoever. Learn more and apply here:

Apply For Paid CDL Training