U.S. Heavy Truck Plunge to Yield a New Cyclical Bottom in 2002 1st Quarter

CHICAGO, Dec. 17 -- Heavy commercial truck manufacture in the United States, Canada and Mexico will yield a new bottom in the current business cycle during the first quarter of 2002, according to Stark's Truck & Off-Highway Ledger ( www.starks-news.com ), a respected business publication.

The journal reported in its current issue that Class 8-type truck and bus- making activity may slip marginally for all of next year throughout the three nations, even though manufacturers rebuild inventories during the period to compensate for the removal of 20,000 units from industry-wide stocks during 2001.

It said the development reflects a continuation of weak industry demand for heavy-duty vehicles through the first half of 2002.

Stark's Truck & Off-Highway Ledger reported that heavy truck production in North America plunged to a nine-year low in 2001 -- first of a two-year decline in the current business cycle. Overall output plunged by 44.5 per cent to 585.3 units in 2001 from 1,055.2 units during 2000, on a daily basis.

In 1992, first year of upturn in the prior business cycle, the business publication reported that vehicle-making activity stood at 527.5 units per day.

The journal said key builders of heavy-duty trucks are preparing to suspend vehicle production at nearly 50 per cent of their manufacturing sites for much of next month to keep a tight lid on unwanted inventories as the local markets for the trucks continues to fall freely.