Chip supplies hamper truck production: ACT Research
By Mike Brezonick25 May 2022
ACT Research reports that its analysts are less confident that supply-chain issues will subside enough for commercial vehicle OEMs to fully meet customer demand this year and next.
That was the conclusion of the company’s most recent Commercial Vehicle Dealer Digest, a monthly report that combines ACT’s proprietary data analysis from a wide variety of industry sources to paint a comprehensive picture of trends impacting transportation and commercial vehicle markets.
“Recent commentary from leaders in the semiconductor industry point to a more cautious outlook for longer,” said Kenny Vieth, ACT’s president and senior analyst. “ASML, a key supplier of semiconductor production equipment, recently called out a ‘significant shortage of semiconductor manufacturing capacity this year and next.’
“In light of this and other industry commentary, we believe lower-for-longer chip availability is likely to restrain the industry’s ability to meet otherwise-strong customer demand.”
Vieth mentioned additional downside risks, saying, “Moreover, about half of the global supply of neon, critical for chipmaking, is concentrated in Odessa, Ukraine, where production has been down since February. The gases that were purified in Ukraine were generated by Russian steel manufacturers. A scramble to re-source is on and inventories are limited.”
In spite of those production challenges, ACT continues to expect higher builds. “Carrier profitability is robust,” Vieth said. “We expect any recession to be shallow and short-lived at this point, and our Class 8 models are indicating pent-up demand, as well as prebuying potential in advance of CARB’s costly Clean Truck mandate.”
ACT Research is recognized as a leading publisher of commercial vehicle truck, trailer, and bus industry data, market analysis and forecasts for the North America and China markets.