'We're in a market correction,' but there's good news

At its New River Valley (NRV) operations center in Dublin, Va., Volvo held an event to detail every aspect of its all-new Volvo VNL truck. In addition to learning the ins-and-outs of the company’s decked-out Class 8 flagship model (wait for our follow up on the ride and drive experience on Volvo’s private test track), Magnus Koeck, vice president, strategy, marketing and brand management, Volvo Trucks North America, walked us through where we’re at in the North American heavy-duty trucking market and where he sees it going as the pre-buy for 2027 EPA engines revs up.

“What can we expect that we are into a market?” Koeck began. “I would say we’re in a market correction. At the beginning of the year, I talked a little bit about that. The market is behaving now exactly as we have anticipated.”

Yet, there’s good news just around the corner in Koeck’s view.

“I’m very convinced that in the end of this year, we may need to wait on after the election,” he noted, “but the trucking market will come back even if the economy may not be that strong.”

Here are some more highlights from his presentation, where he outlined why now was the perfect time to launch the updated VNL:

Volvo’s YTD market share in U.S. and Canada is 0.7 percentage points higher in 2024 than 2023;
The freight market remains soft–another market aspect that Koeck said was anticipated–but it is recovering as inflation and employment begin to normalize; and
Volvo shared data showing that trucks are expected to be $20K more expensive in 2027, and expects to see a pre-buy in 2026.

Koeck also spoke on Volvo’s acquisition of Proterra’s battery business, EV truck market share and the company’s new expansion in Mexico to boost North American truck production. Watch the video to see his full presentation.

FTR said its Trucking Conditions Index indicated a more hospitable environment for carriers in April but remained negative at a reading of -1.95, up from -7.25 in March. Both freight rates and financing costs were less negative, and freight volume improved, according to FTR. The company adds that the TCI has not been positive in any month since early 2022 and likely will be mostly mildly negative for the rest of the year, but it could see some outlying positive readings as it moves closer to neutral territory.“Better days are in sight for trucking companies, but the market still needs to work through the tough combination of too much capacity and sluggish freight demand," said Avery Vise, FTR’s vice president of trucking. "The May payroll jobs figures for trucking offered some encouragement that this transition is underway, but a healthier situation for carriers will require continued rightsizing of capacity and stronger volume. We still do not expect consistently favorable market conditions for carriers until early next year.”