And yet we must keep in mind that we are in a recovery, and sometimes not as bad as we thought can look really good.
Recently, MacKay & Company Economist Dr. Bob Dieli outlined the economy’s current position in what he perceives as a W-shaped recession during a Heavy Duty Manufacturers Association (HDMA) webinar. “We’ve reached the end of the second phase, which is the rebound from the pandemic,” stated Dieli. But a rebound isn’t an end…it’s not over yet.
“Now I think we have to add the effects of the growing number of lockdowns that are in some ways repeating what happened in the first phase. I think we’re in for some type of pause over the next several months, how long and deep remains to be seen,”
The good news is that the second dip in the W shouldn’t be as dramatic as the first.
It’s looking like carriers are starting to purchase trucks now, rather than closer to the end of the recession. This comes from what looks like increased confidence in customer demand. In addition, sales in the parts and service areas are looking like an indication of a willingness to invest in fleets. “There’s more activity out on the road and the vehicles are needing maintenance and repair, so that’s another positive,” added MacKay & Company Vice President of Sales and Marketing John Blodgett.
As a result, MacKay & Company has revised its aftermarket forecast for 2020. Initially, the prediction was about a 19% downturn at the beginning of the pandemic. Now, the aftermarket is tracking to finish down at 10%-15%, says Travis Kokenes, market research manager. Not a number that anyone is happy to see, but after the hardships of 2020, it’s certainly better than it could have been.
Kokenes further added, “Times are tough, no doubt about it, but for those who’ve been in this industry long enough to know, the trucking economy is resilient, and we may yet come out of this most recent downturn stronger than ever.”
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