U.S. economists told attendees at the National Truck Equipment Association (NTEA) 2002 Economic Update in Orlando, FL, that the recession affecting the commercial truck and transportation industry has reached a trough and the economy will begin to expand again by the second quarter of 2002. While the overall outlook for the truck industry points toward recovery, the heavy-truck market outlook is less than rosy. “The heavy-truck market will be negatively impacted in the second and third quarter of 2002 by lower freight tonnage, higher insurance costs, declining used-truck values, and a likely price increase resulting from new emissions requirements,” said Eli Lustgarten, managing director of H.C. Wainwright and Co. Inc. (New York). Lustgarten added that there was a record 4,200 truck company bankruptcies in 2001, which is likely to impact recovery for the heavy-truck market in 2002 as well. Within the Class 8 sector, the number of first owners of vehicles 5 years old or less fell 4 percent in four years while the second-owner population of six- to 10-year-old vehicles grew by 23 percent. This pattern has resulted in a glut of unsold new trucks that will take some time to subside, reported Martin Labbe, president and CEO of Martin Labbe Associates (Ormond Beach, FL). NTEA will host a full-day Economic Outlook Sept. 19, 2002, at the Hyatt Regency in Dearborn, MI. For more information, contact Stephen Latin-Kasper at (414) 294-3408 or e-mail stevelk@ntea.com.

Originally posted on Fleet Financials