Heavy Duty Truck Manufacturers
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 76 heavy duty truck manufacturers in the US produce heavy-duty trucks; heavy duty truck, tractor, and bus chassis; buses; and firefighting vehicles. Additional product categories include replacement parts and other types of trucks. Firms may also offer financing and leasing programs to support purchases.
Sensitivity to Freight Volume and Economic Conditions
The heavy duty truck market is cyclical and highly sensitive to global and national economic conditions.
Government Regulation
Environmental and safety regulations have forced heavy duty truck manufacturers to make substantial changes to their vehicles.
Industry size & Structure
The average heavy duty truck manufacturer employs less than 20 workers and generates about $316 million annually.
- The heavy duty truck manufacturing industry consists of 76 firms that employ 30,000 workers and generate $24 billion annually.
- The industry is highly concentrated; the top 4 companies account for more than 70% of industry revenue.
- Large firms, including Navistar (TRATON Group) and PACCAR, may have operations and sell products in foreign countries.
- In 2022, Freightliner had a 38% market share of Class 8 trucks, Kenworth had a 14%, Peterbilt 15%, International 13%, Volvo 11%, and Mack 7%, according to Wards Intelligence.
- Firms that generate $100 million annually account for 23% of firms and 97% of industry revenue.
- In 2022, there were 4.06 million Class 8 trucks in operation, up 2.3% from 2021, according to the American Trucking Association (ATA).
Industry Forecast
Heavy Duty Truck Manufacturers Industry Growth
Recent Developments
Mar 20, 2024 - Producer Prices, Wages Increase
- According to data from the Bureau of Labor Statistics (BLS), producer prices for heavy duty truck manufacturers peaked in Q4 2023 after inching up for much of 2023. Producer prices have increased in recent years, up almost 8% from December 2019 to December 2023. Employment rates in the motor vehicle manufacturing industry were mostly unchanged in December 2023 compared to a year ago, but have gone up by 26.1% since 2019. Wages for the motor vehicle industry have increased significantly, with a rise of 17.5% from December 2022 to December 2023 and 23.5% since 2019, per the BLS.
- Truck freight volume, an indicator of demand for heavy duty trucks, fell almost 16% in Q4 2023 compared to Q4 2022, according to the latest US Bank Freight Payment Index (FPI). The decline in truck freight volume in Q4 2023 was the most acute in the Southeast and Northeast, according to the report, which also revealed that spending by shippers declined in the fourth quarter. Commenting on the downturn, Bob Costello, senior vice president and chief economist at the American Trucking Associations, said, “The truck freight market is feeling the impacts of companies reducing inventories significantly as well as consumers continuing to spend more on experiences over goods. We’ll watch carefully in coming quarters if companies complete their inventory reduction efforts and begin to restock, which would help boost trucking.”
- The for-hire truck tonnage index, an indicator of demand for heavy duty trucks, declined 1% in November 2023 compared to the previous month, according to an index released by the American Trucking Associations (ATA). The index had risen by 0.8% in October 2023. The for-hire tonnage index decreased 1.2% year-over-year in November, marking the ninth straight year-over-year decrease. According to ATA Chief Economist Bob Costello, “We continued to see a choppy 2023 for truck tonnage into November. It seems like every time freight improves, it takes a step back the following month. While year-over-year comparisons are improving, unfortunately, the freight market remains in a recession. Looking ahead, with retail inventories falling, we should see less of a headwind for retail freight, but I’m also not expecting a surge in freight levels in the coming months.”
- US manufacturing activity contracted in February 2024, falling below the baseline for growth for the sixteenth consecutive month, according to the Institute for Supply Management’s Manufacturing ISM Report on Business. The Manufacturing PMI registered 47.8% in February, down 1.3 percentage points from the 49.1% recorded in January. A reading above 50% indicates manufacturing expansion. February’s New Orders Index was in the contraction zone at 40.2%. The February Production Index was 48.4%, a decrease from January’s 50.4%. Eight manufacturing industries tracked by the ISM reported growth in February: Apparel, Leather & Allied Products; Nonmetallic Mineral Products; Primary Metals; Plastics & Rubber Products; Fabricated Metal Products; Chemical Products; Miscellaneous Manufacturing; and Transportation Equipment. The industries reporting contraction in February were Furniture & Related Products; Machinery; Wood Products; Computer & Electronic Products; Food, Beverage & Tobacco Products; Paper Products; and Electrical Equipment, Appliances & Components.
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