WardsAuto reports (subscription required) that April Class 8 sales numbered 16,905, which is only about 500 sales off the four-year-high set in October of last year.
 
However, based on the monthly declines in orders in 2012, we can expect a flat to downward trend in sales in the 2nd to 3rd quarter.

FTR Associates’ TruckGuage reports (subscription required) that the story behind declining orders is that an unusually high number of these trucks were for immediate delivery and delivery in the 3rd quarter, essentially skipping the 2nd quarter. In addition, the order cancellation rate increased from 6.1% to 9.0% in March, reducing our optimism.

Fundamentally, the domestic economy is not providing any real reason for concern. The manufacturing and natural resources sectors that have driven the rebound in trucking continue their upward trends (although a shift away from natural gas fracking may negatively impact regional construction and transport activity). Consumer spending has steadily increased over the past two years, and is in fact higher than it was before the Great Recession. Consumer credit is also back to near-pre-recession levels. And the average age of the national truck fleet is the oldest it’s been in over 30 years.

International events are a different story. The slow-motion implosion of the Euro Zone will likely prolong the global financial crisis by limiting growth of imports and, more importantly, weakening European banks, with implications to US investors.

Combine these factors with our dysfunctional political system that has so far failed to address a laundry list of tax cuts set to expire on December 31, and you have a valid case for “uncertainty.” Analysts dislike the “uncertainty” explanation, since it is difficult to quantify and is subject to change at the drop of a hat. Unfortunately, it is one of those qualitative factors that can sometimes override economic reality, as we’re seeing in the new truck market.