The US truck market is facing a period of extended weakness in demand for new equipment, potentially lasting longer than previously anticipated, according to Jonathan Starks, chief executive officer of FTR Transportation Intelligence, an economic forecasting firm.
Nearly two and a half years of weak freight conditions are now significantly impacting truck orders and demand for equipment. This can hit the automotive component makers, including the leading Indian suppliers like Bharat Forge Ltd., Starks told NDTV Profit in a conversation. "The weakness could be persistent for a much longer period of time than we would have anticipated at the start of 2025."
A key factor influencing the market outlook has been the uncertainty surrounding the implementation of a stricter US Environmental Protection Agency emissions norms, scheduled to take effect from the beginning of 2027. These norms were widely expected to increase the cost of new truck engines significantly, potentially triggering a "pre-buy" — a surge in orders for current models in 2026 before the new regulations hit.
However, Starks explained that while engine manufacturers are already certifying new engines compliant with the 2027 standards and development costs are largely locked in, the possibility of the current administration delaying or modifying the regulations dampened pre-buy enthusiasm.
Despite the likelihood of an increase in prices, fleets are going to be very hesitant to pre-buy equipment, according to Starks. "There's an opportunity that it could still happen, but that is becoming rapidly reduced as we move into 2025."
Regarding the market outlook for Class 8 trucks, which is a key indicator of demand for forging companies, Starks indicated a significant shift in recent months.
"If we had this discussion two or three months ago, I would say that the outlook is relatively robust to see probably weakness in 2025. I think everybody was well attuned that the market was weakening as we were going through 2024, but a pretty well attuned market ready to grow in 2026," he said.
"Now, we're losing the ability to see that growth potential fully come to fruition. Right now, I'm still not anticipating that 2026 is going to be a weaker year than what we're seeing right now here in 2025," he added.
Starks predicted that 2026 would be modestly better than 2025 if the US economy maintained at least some growth through the current year.
However, the uncertainty created by US President Donald Trump's policies is weighing on the economy. The risks of a recession or an extremely stagnant US economy have grown substantially over the last month amid a lot of uncertainty, according to Starks.
"That is going to begin to wear on the US economy and could slow it down enough that we don't see any growth going into 2026, which would significantly change what our projections are for next year."
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