There’s growing optimism about a “rebound” starting to gain steam in the vocational market – with the construction industry fueling a need for dump trucks and other equipment—according to OEMs interviewed at The Work Truck Show in Indianapolis.
“We’ve seen a definite upswing in the construction market due to new home building activity and we expect that uptick to translate into more truck orders in the second half of this year,” David Hames, gm of marketing and strategy for Daimler Trucks North America (DTNA), told Fleet Owner.
“Increased housing starts is driving demand for construction vehicles, especially for concrete mixers, which have been hurting for some time,” added David Majors, vp-production development for Navistar. “Mixer truck dales really suffered in the aftermath of 2009.”
However, Majors believes that sales of Class 6 and 7 vocational trucks should experience more growth during this “rebound” than Class 4 and 5 models. “There’s been a belief that Class 4-5 sales expanded faster than Class 6-7 over the past few years, but what really happened is that Class 6-7 sales dropped while Class 4-5 held steady. Now, Class 4-5 will remain constant while Class 6-7 will see growth.”
That isn’t stopping Navistar from beefing up its Class 4-5 offerings, however, for at the NTEA’s show this week, the OEM unveiled a four wheel drive (4x4) upgrade to its International TerraStar Class 4-5 chassis, so it can offer more capability for a wider range of customer needs, including construction, utility, landscape, and other off-highway applications.
The NTEA’s retail truck sales forecast – compiled with the aid of consulting firm IHS Global Insight – projects a 5.4% growth in Class 4-7 sales this year over 2012, with a 9% spike projected to occur in 2014 versus 2013, followed by an 8.3% spike for 2015 over 2014.
And while a similar forecast by global research firm Frost & Sullivan projects only “moderate” demand for medium-duty trucks in North America, global medium and heavy truck demand is still expected to increase by 4.3% worldwide this year, resulting in sales of 2.8 million units in 2013 – with higher demand for medium-duty trucks relative to heavy-duty trucks.
Curtis Dorwart, vocational marketing product manager for Mack Trucks, told Fleet Owner that another critical factor that should fuel vocational truck sales growth this year is high equipment age.
“Equipment is getting old as customers put off buying new trucks for several years,” he explained. “That, combined with what’s clearly an uptick in construction activity, is going to offer a good opportunity for everyone.”
Mack is hoping to capitalize on that uptick in demand by offering a new 4x2 version of its Granite Medium Heavy Duty (MHD) Class 7-8 model; a truck that in Dorwart’s words “offers a great option for customers needing a truck tough enough to manage their daily operations, but in a lighter weight configuration to increase their return on investment.”
Equipped with a 345-hp Cummins ISL9 engine with a maximum torque rating of 1,150 lb.-ft., Dorwart said the MHD also offers a “clean back-of-cab” design helps the MHD 4x2 accommodate a wide variety of body options, including those required for utility, dump and municipal applications.
The short bumper-to-tire distance offers front-end swing clearance and superior wheel cut – key for navigating tight turns in municipalities and construction sites, he said.
“The key is to have vehicles at all the right price points and configurations for vocational customers,” Dorwart explained. “That’s how we’ll take advantage of the coming growth in the vocational market.”