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There Go The Truckers: Unprecedented 59% Plunge In November Heavy Truck Orders
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:
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:
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.
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Lots more pain to come before we get to the ( Save us .GOV ) begging stage.
Forget free 0bamaphones!
Let’s give everybody a free 0bamatruck! ;-)
Looney
Bullish...
If I didn't know any better I'd think that AGW is creating all sorts of problems.
Ammo and weapons don't take much space in a truck, and the majority of spending recently has been on ammo and weapons.
This correlates with the decrease in shipping from overseas...no containers, no need for intermodal or trucking.
Charts...
https://blog.transplace.com/category/economic-data/morgan-stanley-capaci...
Turkey's recruiting. Excellent perks. Short working hours.
The leftover 41% were all on I-81 last week, I can assure you.
pods
Hey pods, anything north of I-10 is too damn close to the North Pole, and I don't own a TV or (except for ZH :) pay attention to the MSM, what happened on I-81?
Pennsylvania happened. lol.
Thanks pods!
I've driven through there many times ... they deserved it. Whatever it was. It is damn cold there, even in the summer.
Hopefully I'll get a downvote for this too!
It's the warmer than usual start to winter.
prolly cos winter don't start till the 21st.
fucking funny.
thanks for the chuckle.
hmm
Where are those Syrian refugees Obama promised that might pump the sales of this trucks.
All 1oz Silver coins are €12 @ EurGold
https://www.eurgold.eu/silver/silver-coins/
Old Yeller will fix everything by raising rates
Might need to make that a full 1% increase. /s
Oh marvelous ! Let's whistle a happy tune ! Now every day is a birthday ! We LOVE Old Yeller I tell you !
(insanity stricken)
One of the reasons is that nobody wants un-reliable pieces of shit that cost $100k too much in order to comply with emissions standards. All with no real gains in fuel economy.
I don't know who down voted you but they must be a stupid fucker...
Not in the least.
@ bluskyes No idea if what you say is true ... but good point about the fuel economy - because of the fuel. Got into a good article about bio-diesel fuel last night:
"Advantages include lowered exhaust pollutants, better lubricity, and higher cetane rating. ... downside includes reduced efficiency and power ... great vulnerability to cold-weather clogging; ... increased solvent properties [think dissolving fuel hoses, etc.] ...; a greater likelihood of injector-nozzle coking and plugging... Biodiesel manufacturing also results in the production of glycerin, which, even in very small amounts, can disable fuel filters."
This article was printed in a professional publication for my field, which is not trucking, so I don't know yet if truckers are having biodiesel shoved down their throats like ethanol gas for auto drivers, but if biodiesel is one of the mandates to comply with emission standards ...
Personally, I find that re-branding 87 and 89 octane gasoline as "containing ethanol" is a crime.
You want to sell "gas + ethanol"? Label it the fuck as such!
As it is, they're destroying small engines like chainsaws. Broken window economy ftw! (Fuck you Obama for Cash for Clunkers and all the rest.)
You understand that they are talking about these trucks having things to deliver, and not the sale of new trucks, right?
Not in this article. Paccar is a commercial truck manufacturer. If they were talking about Celadon, or Schneider then we'd be talking about cargo.
Look for the next scam, insolvent .gov paying to have empty trucks run the highways, probably better then having them study elderly dating habits.
On the plus side, you get better fuel economy when driving the truck without a cargo.
And you'll have time to date.
BZZZZT! Nid, you are 100% wrong on this, so you get a big fat ZERO on reading comprehension. The article is completely about TRUCK SALES, not deliveries.
... the three douchebags who upvoted you are hereby and henchforth banished to the dunce corner.
Fuck. Try reading an article before commenting.
Now why would we ever want to do that? That takes all the fun out of shooting our mouths off in the comments. ;)
Who cares what Wells Fargo says ... what do the truckers say?
I asked a trucker friend of mine and his response could be shortened to exactly what Bluesky said.
Big rigs are expensive and in our economy, hard to amortize. I know a lot of truckers who hae quit completely. Between being screwed by the trucking companies and all the federal regulations they haven't got an asshole left to screw......
Truckers are really going to get fucked in whatever asshole they have left when the industry shifts to driverless....
Mish Shedlock says this will be underway in earnest by 2020.
Assuming there's an economy left.....
any odds the depreciation cycle is 5 years? Trucking companies may be keeping their powder dry in anticipation of self-driving trucks.
Excellent analysis.
And for the scientists: anallysis
Yuck. :-P
Prius trucks. Wave of the future. They'll carry at least 6 bags of groceries, 2 bicycles, and 2 full sized yoga pants wearing MILF's.
'You had me at, 'yoga pants wearing MILF's.'
how to make a milliion in the trucking industry? spend 2 million
simple math...
ya can't ship what hasn't been built/made(US Manufacturing)
Don't forget the other half of the equation: for every truck you don't buy, there's a driver you don't have to hire.
@ RawPawg Trucks are how all the imported stuff we no longer make gets from container terminals to the CONSUMER. Trucking is an impressive industry!
No kidding. I ordered tires that were only available 3k kilometers away and I had them in 3 days. By train they would take 4 days or maybe a month. What we need is a tunnel system that would send stuff at 600 kph cross country.
Sounds like a great idea, although we have to make sure it's only built to last 40 years, like our highways and bridges. We will also have to neglect the tubes during this time period as well so that we can create jobs fixing them in the long run...krugman would agree. If they'd built the cathedrals with sticks and tarp they would have unlimited jobs forever.
We already have those. I don't think they'll be open for civillian use until after the third great war though.
http://www.bibliotecapleyades.net/offlimits/esp_offlimits_7.htm
http://uncontrolledopposition.com/2013/12/20/d-u-m-b-s-deep-underground-...
"Was the dark of the moon on the sixth of June
In a Kenworth pullin' logs
Cab-over Pete with a reefer on
And a Jimmy haulin' hogs
We is headin' for bear on I-one-oh
'Bout a mile outta Shaky Town
I says, "Pig Pen, this here's the Rubber Duck.
"And I'm about to put the hammer down."
https://www.youtube.com/watch?v=RVh179oXFao
"Keep the bugs off your glass,
and the Bears off your ...tail."
10-4
And keep the beavers in sight
and up all night:
https://www.youtube.com/watch?v=ZmtMUpUvdFk
(Ali McGraw at 2:52)
What's weird is without GTA5 I wouldn't know this song. :)
BalticDryed.
When Irish road freight collapsed between 2008---10 it transfered a huge amount of purchasing power back to the Irish people albeit it was extremely unbalanced given the lack of a national dividend
Trucking even for light consumer goods does not make physical economic sense in such a vast country.
Why not a rail hub, light truck distribution system?
After the Irish bailout of the consumer war economy in late 2010 road freight waste was the last venting of energy phenomenon to recover, reaching a nadir in 2013...
Wastage of fuel in this sector is again rising.....
US rail is more cost-effective than trucking at distances exceeding about 600-700mi. This is where the CLASS I rails (BurlNorthSF, UNP, NorSouthern)
are at their best. Of course, there are exceptions re nature of the load, size etc. Furthermore, transitioning of the US over-the-road trucking fleet to nat gas in addition to
shifting towards driverless would make the industry likely more competitve w/ rail at ever longer distances.
I have noticed trains going through town that are longer than usual.
With extra locomotives.
Miles took a while for them to pass.
Never seen them this long in my life.
It will never get close to this boom and bust........or will it ?
Irish road freight energy consumption
Y1990 : 346 ktoe
Y2007 : 1,145ktoe (peak)
Y2013 : 581ktoe
Y2014 : 621 ktoe (recovery ?)
Stuff in Ireland generally not more then 200miles away from each other at max.
Moving stout off rail and on trucks the height of waste... Also low value agricultural feed and hay is road based
All high volume, high use products such as the above should be rail based even on a island as small as Ireland.
I get some work from a small farmer in the extreme Sw of Ireland.
He must do a 200km road trip to collect hay from the golden vale.
A rail depot in Tralee would serve all of Kerry.....
But our banker masters like waste..... They make shit loads of money on it.
Ps, the waste is not about the money as the financial system is a mirage.
It's the amount of energy wasted in distribution.
We must then waste vast amounts of money / energy on capex to replace oil in other sectors of the economy as there is not enough to go round.
just wait till more regulations like the new train signals regs are lowered onto the rails.
Come on . . . Come On . . . . Come On . . . let's go Space Truckin' , Come On . .
Deep
Had a trucker offer his class 8 tractor in Galveston ( 2014 Peterbuilt worth 32K) for 12K and walked away. Truck is still sitting from 3 months ago. Was hauling freight out of the port of houston.
ARE U FUCKING KIDDING ME????? you can get a 2014 Peterbuilt for under 32K??? A goddamn Ford F150 costs 60K!
He's bullshitting you. No possible way you can get a 2014 Pete for 32K even out of a bankruptcy. But prices are dropping. I have 7 of them
Amazon drone?
I am in the biz and it has ben abysmall since October, freight just dropped off a cliff for some reason or another and it is Nationwide, I do mostly southern freight and shipments but even all my industrie friends in the north where it is generally very busy (chicago, Detroit, Wisconsin etc) Say they are loosing money up there as well. Havent seen it this bad since 2009, not quite there yet probably 30% busier than 09 but heading there quickly.
I am in the biz and it has ben abysmall since October, freight just dropped off a cliff for some reason or another and it is Nationwide, I do mostly southern freight and shipments but even all my industrie friends in the north where it is generally very busy (chicago, Detroit, Wisconsin etc) Say they are loosing money up there as well. Havent seen it this bad since 2009, not quite there yet probably 30% busier than 09 but heading there quickly.
Any idea about food shipments? America's supply chain, based on just-in-time deliveries, means that trucks are, in effect, mobile warehouses. Fewer trucks on the road mean a smaller warehouse. If this is in response to lower demand for food, then it's probably not a problem. But if there are fewer trucks because of problems in the economics of trucking, it may be hard to keep the shelves full.
Time for the 'Cash for Class 8 clunkers' program. Maybe spin it as a Green-drive for a bettah environment (for taxes, tyranny, and terrorism).
Come on! Surely these numbers can be double seasonally adjusted and hedonically massaged to arrive at a much better picture!!
they forgot to include the truckers that thought about a new truck.
Long truck-stop stawks.
Is this bullish for lot lizards?
Everything is awesome
Everything is awesome
Everything is awesome
Everything is awesome
Everything is awesome
Everything is awesome
Everything is awesome
Everything is awesome
Everything is awesome
Everything is awesome
Everything is awesome
Everything is awesome
Everything is awesome
you forgot to say "repeat after me". How will we ever learn?
Everything is awesome
Everything is awesome
Everything is awesome
Everything is awesome
Everything is awesome
Everything is awesome
Everything is exhausting
Everything is exhausting
everything....ug, I need a nap.
Thanks, I needed that....
old truckers never die; they just get a new Peterbilt
The pain is being felt in all segments and all the way along the logistics chain. Aside from industry-specific drags (Obama's War on Coal, opening American highways to Mexican truckers, Chinese demands for give-backs from US ports) there simply isn't the retail demand for cheap Chinese crap, centrally generated electricity, or excess groceries. No demand, no business. The supply-side cult can keep up their circle-jerk, but should be kept away from the rest of us.
So much for the "I can always get a CDL" option.
Here are some signs of a coming recession.
1. Factory orders continue to drop
http://www.zerohedge.com/news/2015-10-02/us-factory-orders-flash-recession-warning-drop-yoy-10th-month-row
2. Default risk spikes
http://www.zerohedge.com/news/2015-10-02/us-financials-default-risk-spikes-2-year-high
3. M&A set record
http://michaelekelley.com/2015/05/29/mergers-and-acquisitions-set-record/
4. Fed sees 2 bubbles
http://michaelekelley.com/2015/02/20/fed-warns-of-two-bubbles/
o Commercial Property higher than pre-2007 level.
http://nreionline.com/finance-investment/cre-prices-are-now-officially-above-pre-recession-peak
o Global Corporate Debt Market hits $5 trillion.
http://fn.dealogic.com/fn/DCMRank.htm
5. Iron ore prices tumble
http://www.marketwatch.com/story/iron-ore-prices-keep-crashing-adding-to-global-growth-fears-2015-11-30
6. Baltic dry shipping index tumbles
http://www.marketwatch.com/story/shipping-index-falls-to-all-time-low-stoking-fears-about-global-growth-2015-11-19
Here is how to prepare.
http://michaelekelley.com/2014/10/16/8-things-to-do-when-recession-happens/
Here is how to get your mind off this stuff.
http://michaelekelley.com/category/humor/
Good luck!
^^^^^^^ THIS ^^^^^^^^ IS ^^^^^^^^^^^ SPAM.
Tyler, please ban this asshole.
Most of the trucks I see on US highways now have license plates that say "Chihuahua Mex","Sonora",or "Distrito Federal"..And most of the truckers I run into at truck stops say demeaning Mexican shit like "pinche gringos",and "chupa la verga"when their in the checkout line,blowing snot on the cashier,and wiping the crack of their asses..
I've always heard that trucking was indeed the backbone of the USA Economy ... the best indicator since everything is hauled over the Trucks, specially the big trucks.
This ain't good news at all.
For insurance purposes the Saudis and Qataris are waiting until January 2016 before ordering replacments for the thousands of their oil tanker trucks which have been mysteriously burning up since October.
Lunch break is long over, but since I'm probably the only female of the opposite sex posting on this story ...
Great pics of two powerful-looking big rigs!
What's a female of the opposite sex? Is that you Bruce......er..Caitlyn?
With a name like Berspankme you automatically don't have a big rig.
Baby, you left yourself wide open for that one.
xoxo
Ana
PS I helped you "up" with a +1
;-*
No problem. Turkey just faxed in an order for another 1,800 top of the line models.
Sales 101 - The "new and improved" Growth Model
Step1: Bomb the shit out of a market that is closed to the USSA under the guise of spreading democracy
Step2: Deny everything by owning the press and confusing the shit out of the public
Step3: Rebuild market in Step1 by selling only "Made in America" product
Step4: Use TTP/TPIP as cover for only allowing USSA made product to be sold into bombed out market
Step5: If Step4 fails, sue the shit out of target market. Gives our lawyers a job.
Step6: All about Growth Baby
Grandma Yellen and the ponzi that is the Federal Reserve and all its elitest shareholders thank you.
For men I thought that was #1???
(We're all truckers here ... ;)
This is proving to be yet another economic metric that needs immediate attention from the Ministry of Untruthiness
I could fix and answer that one too but if there are any PC moderators on this site I'll be permanently banned. But that won't stop me from starting:
What's six inches in metric?
Mistress of Undr...
Actually, I just looked at my ruler - six inches is about 15 cm - that's a big number! I CAN'T BELIEVE THIS COUNTRY HASN'T GONE METRIC!!!!
I'm going, ummm, downhill fast and it's not even Friday yet - gotta go.
Sorry guys but this is a non-issue, we have much larger things to focus on. Including but not in this order:
- Kardashian ass
- Black lives and safe spaces (and poop swastikas)
- Bernie Sanders' hernia operation.
And your username is BeaverCream ... and as I type this your post comes right after mine.
One of us needs to work on our timing.
(That's what s/he said.)
I've done a lot of traveling, and buy my fuel at truck stops. Over the past decade I've seen a marked change in the appearance of "truck drivers". Not many drivers at the fuel desks today look like the guy next to the white rig.
Most of them are grungy, fat, wearing turbans, have big black beards, or just generally look like they have a room-temperature IQ. Like they were rejected at McDonald's, Home Depot, or Walmart for employment.
In days gone by, over the road trucking was a respected profession. The drivers had to be professional and courteous to ensure their customers' freight arrived safely and on schedule. Bad weather, technology inferior to what we have today (brakes, engine horsepower, tires, aerodynamics, creature-comforts, etc), and road conditions (the country hasn't always had the 4-lane Interstate system it has today) made "driving" 80,000 pounds a skilled occupation. If you didn't poses the skills necessary, you'd wreck and die. Literally. And many drivers did.
Nowadays with antilock brakes, automatic transmissions (one doesn't even need to know how to shift anymore)400+ Horsepower so you just power up any grade, anyone that can fog a mirror can be taught to drive truck and probably stay alive even if they DO wreck. And the companies have done just this. They constantly recruit and train these monkeys. There's no professionalism left in the industry. No skills are required other than to show up.
It's disgusting to me because this race to the bottom is happening in ALL of our previously-respected professions.
So true. My brother drove trucks from Ireland all the way to Iran. No SATNAV, virtually no power steering, needed to do a lot of in-journey repairs himself. The job took real knowledge and ability.
What exactly is the difference -- in real terms-- between a robo truck and a railcar??
The robo truck moves faster and has a lot more track.
"the relative calm of the market surface"
Traders, they bet everything on the Fed. Economic fundamentals mean little, when the biggest money printer on earth is committed to " Wealth Effect " equity bubbles. Traders have learned that The Fed is where to stake your money.
On a related note, since truckers move most of the edibles in this country, I have seen more than the usual amount of food marked down of late. Just today, bought a pork loin roll for $4.67, like $1.36 a pound. Said use or freeze by Dec. 4, so it's good and in my freezer, but, there is so much of this kind of thing, my freezer is getting full. I don't eat that much, though it should be of benefit to families and the FSA.
Well do your part and start filling your pie hole...our economy is driven by obesity.
Maybe we could use the excess trucks to house the refugees and pay the truckers to keep trucking them around right on through to Canada.
Bring some $3/kg pork loins while you're at it. No need to worry about the refugees eating it on the way. Prices here are a little higher.
$15/kg regular
$11/kg on sale
$9/kg last day
Plus, the pork is injected with water in the back of the store.
(1kg = 2.2lbs)
'
'
'
Just wait for the bogus line of "It's a 'jobless recovery'!" like they did in Canada in the early 90's after that recession.
Coincidently, that was the beginning of the rise of the first decent computers.
But the machines created a lot of jobs. Everybody got into them, and wages dropped.
I watched it wipe out the graphics/publishing business.
Then the little ßå$†å??$ got very much faster in the early 00's.
Look up the job partcipation chart and you'll see it peak in 2000.
https://research.stlouisfed.org/fred2/series/CIVPART
And the inactivity rate for males 25-54, started ramping in the early 90's.
https://research.stlouisfed.org/fred2/series/LRIN25MAUSM156S
The next step is the automation.
Starting in 5 years, we're screwed.
•?•
V-V
Only makes sense with crashing Baltic index, less plastic chinese shit coming into the borders=less shit to haul around. It's environmental positive. LOL. Always some way to make it look good.
In theory you can lose half your orders for an infinite period of time. So in theory nothing to panic about.
In theory, practice and theory are the same, in practice.......well ask Yogi Berra, he could always explain it better than an ec onomist.
That wife of mine's the suspicious kind
She says that I'm quite a flirter
But I've been a good boy all of the time
And I wouldn't do nothing to hurt her
She'll tan my hide for spending the night
With Betty Lou or Alice
But I'm sleeping alone, in this wreck I own
Broke down, South of Dallas
https://youtu.be/wlFHsSZcG6Y?t=63what % of class 8 trucks are owner operators and what are giant immigrant employers?
I have a suspicion that 1) deliveries are down and 2) trucking firms are hoarding capital for self-driving trucks. The combination of the two looks to be deadly for current new-truck orders.