Truck demand remains robust, driven by strong economic growth and a surge in freight activity. Many manufacturers have filled their order books for the rest of 2021, with some even beginning to accept orders for 2022. However, production schedules are becoming more uncertain due to ongoing supply chain disruptions, particularly in the semiconductor sector. This bottleneck has led to delays and limited visibility for truck makers, who are struggling to meet rising demand.
In addition to supply chain issues, raw material costs—especially steel and copper—are putting pressure on profit margins. To offset these rising expenses, many truck manufacturers have raised prices for the 2022 model year. Despite these challenges, most companies remain optimistic about the long-term outlook, citing strong demand across global markets.
Below are key insights from the second quarter 2021 earnings reports of major truck manufacturers:
### Company Outlooks
| Company | Outlook | Date |
|-------------|-----------|------------|
| Meritor | Positive | 8/4/2021 |
| Cummins | Positive | 8/3/2021 |
| Paccar | Neutral | 7/27/2021 |
| Daimler | Neutral | 7/21/2021 |
| Volvo Trucks| Neutral | 7/20/2021 |
| Navistar | Neutral | 6/8/2021 |
### Meritor
Meritor's CEO highlighted that labor shortages and global supply chain constraints have created a challenging environment. The company is facing significant cost pressures, especially from rising steel prices. To mitigate this, Meritor is working closely with customers to recover costs and improve operational efficiency. Despite these challenges, the company has raised its production guidance for both North America and Europe, reflecting continued strong demand.
### Cummins
Cummins reported strong sales growth in Q2, driven by robust demand in North America and other key markets. The company emphasized that the strength of the order book reflects underlying demand despite ongoing supply chain issues. Cummins is well-positioned to benefit from continued economic growth and increased activity in sectors like construction and mining.
### Paccar (Kenworth & Peterbilt)
Paccar’s leadership noted that freight tonnage, industry truck utilization, and customer demand for new trucks are all at strong levels. The company’s new models are receiving positive feedback for their fuel efficiency and technology. However, semiconductor shortages continue to impact production, with many trucks waiting for key components before being completed.
### Daimler (Western Star and Freightliner)
Daimler’s CEO stated that order books are full, and production will depend heavily on supply chain stability. The company is sold out for 2021 in North America and Europe, with no new orders for 2022 yet accepted. While demand remains high, production is constrained by limited access to semiconductors and other critical components.
### Volvo Trucks
Volvo reported strong freight market conditions and high truck utilization. Despite supply chain disruptions, the company managed to deliver nearly 46,000 trucks in the quarter. However, production was temporarily halted for a month due to supply issues. The bus segment continues to struggle, but there are signs of recovery as travel restrictions ease.
### Navistar (International)
Navistar noted a strong global truck market recovery, with significant growth in the first half of 2021. The company is seeing improved demand, though it continues to face challenges related to supply chain constraints and component availability.
As the industry moves forward, the focus remains on managing supply chain risks, controlling costs, and meeting growing demand. With the economy continuing to recover, the truck manufacturing sector is expected to remain resilient, albeit with ongoing challenges.
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