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Kenworth remains optimistic about truck market

Truck News  /  May 18, 2016

Class 8 truck orders have fallen sharply in the early months of 2016, but Kurt Swihart, director of marketing for Kenworth, is maintaining an optimistic view.

Speaking to trade press journalists today, Swihart said Kenworth predicts Canada/US Class 8 retail sales to total between 220,000 and 250,000 units this year. That’s down from about 280,000 last year, but Swihart pointed out this year is still likely to be the third best year in the past decade.

“It’s still a very healthy market, a very good market for the truck industry,” he said.

Swihart gave a number of reasons why he thinks demand for new trucks will remain healthy, including an uptick in US for-hire truck tonnage, the return of manufacturing activity to positive territory and strong housing and construction activity.

There has also been lots of road and commercial construction in the US, driving demand for vocational trucks.

“Anecdotally, we hear stories from dealers saying it’s difficult for them to keep stock dump trucks on their lots,” Swihart related. “As soon as they get T880 dump trucks in stock, they’re able to sell those.”

And with oil prices on the rise, Swihart said he’s anticipating the return of demand in the oil and gas industry.

“There are a lot of good indicators out in the market and we feel this year is off to a good start and that 2016 will be a very good year for Kenworth,” Swihart predicted.

The Chillicothe truck plant, where Kenworth T680s and T880s are built, has been busy, producing 128 trucks a day. The day shift is running at capacity while the second shift is running at about half of capacity. Judy McTigue, plant manager, said Kenworth reacted quickly to softening market conditions, which allowed it to adjust its staffing levels in accordance with demand. That has kept things steady so far this year.

There’s also a major construction project underway at the plant. A new 25,000 sq.-ft. parts management system and automated storage facility is being built on top of the existing plant, at a cost of US$17 million. Currently, Kenworth stores painted cabs and hoods outside in the elements, but the new storage facility will allow it to free up outside space while keeping painted components protected from the elements.

“Painted product will never go outside anymore,” McTigue said. The new facility is expected to be up and running by November.

Swihart said these are exciting times for Kenworth, which is riding the popularity of its new flagship T680 and T880 models. Those two trucks now comprise 90% of Kenworth truck production in Chillicothe.

 

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Kenworth’s Ohio Plant Getting New Parts Storage Facility

Heavy Duty Trucking  /  May 18, 2016

The Kenworth plant in Chillicothe, Ohio, is getting a $17 million automated storage facility to bring cab parts inside, out of the weather, and add efficiency to assembly operations, executives said on Wednesday. They also foresee another healthy sales year for Class 8 trucks.

Contractors are adding a second story that will house the facility, along with a computerized material handling system that will store parts as they’re delivered and retrieve them for trimming and positioning on the assembly line, where they’ll be matched to chassis.

The facility is scheduled for operation in November, said Judy McTeague, the plant’s manager.

The plant now is on two shifts: The first shift is at capacity, 80 trucks per day, and the second assembles 45 a day, following a “feathering” of production  last year to react to a slight softening in new-truck orders, she said.

Healthy sales

Class 8 retail sales in North America his year should reach 220,000 to 250,000 – still a healthy number following last year’s 280,000, Swihart said. Overall economic factors have turned upward in recent months, boding well for continued high freight tonnage and therefore demand for trucks to haul various commodities and products.

Construction in particular is strong as “new-housing starts are the highest they’ve been since 2006-2007,” Swihart said. That maintains the strong market for vocational trucks.

“We have anecdotal stories from around the country that it’s difficult for dealers to keep stock dump trucks on their lots,” he said, “because they’re selling so fast.”

Plant production

The Chillicothe plant makes Kenworth’s two latest models, the T680 highway tractor and the T880 vocational model, along with “legacy” T660 and T800 models. The T680, introduced four years ago, now comprises half of all KW sales, said Kurt Swihart, marketing director. The T880, introduced in 2013, accounts for 30% of all sales.

The remainder of sales are of legacy trucks with some customers still prefer, but the percentage is dwindling as buyers discover the room and technology advantages of the more recent models, he said.

The new parts facility and handling system will boost efficiency through rapid storage of painted parts, and deliver them faster when they’re needed on the assembly line, McTeague said.The 25,000 square-foot addition, being built on the top of the current plant, will have a climate-controlled environment to provide quality improvements for painted parts. 

The first Kenworth truck rolled off the Chillicothe assembly line in 1974. Employees at the state-of-the-art Kenworth factory produced the plant’s milestone 500,000th truck in February. Throughout the plant’s 42-year history, Kenworth-Chillicothe employees have maintained a strong focus on quality, efficiency, customer satisfaction, and environmental stewardship, executives said.

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Kenworth T680 and T880 Now Mainstays at Chillicothe Plant Undergoing Expansion

Transport Topics  /  May 19, 2016

Kenworth Truck Co.’s two latest models, the T680 and T880, launched in 2012 and 2013, respectively, now account for 90% of production at its manufacturing plant here, replacing earlier legacy models, said Kurt Swihart, director of marketing at Kenworth Truck Co.

At the same time, the plant has begun a $17-million addition of a parts management system and automated storage facility, the company said.

The new system will increase the plant’s efficiency by using technology to achieve rapid storage of painted parts, and faster delivery of those parts when needed on the assembly line, Kenworth said.

The new storage facility is being constructed atop the plant, which continues to operate and build trucks during day and night shifts.

Swihart spoke to reporters during a ride-and-drive event that included the latest configurations of the trucks and components, including a T880 40-inch sleeper tractor, a T680 52-inch mid-roof sleeper tractor that weighed about 14,200 with a partially filled fuel tank, the Allison 4700RDS seven-speed automatic transmission used in a T880 day cab with cement mixer body, as well as Paccar Inc.’s 10.8-liter MX-11 and 12.9-liter MX-13 engines.

Swihart said Paccar, the parent company of Kenworth as well as Peterbilt Motors Co., believes U.S. and Canadian retail sales this year will range from 220,000 to 250,000. That compares with 280,000 in 2015.

He said the year-end total could reach the “third-highest in the last 10 years.”

He cited several encouraging trends, including: a rise in tonnage, gains in the ISM index of supply chain activity, housing and construction starts “doing well”, 5% unemployment and crude oil climbing back up toward $50 a barrel.

Swihart said, “2016 is going to be a very good year for Kenworth.”

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Kenworth's Ohio plant to complete robotics-rich addition

Fleet Owner  /  May 19, 2016

Kenworth's nearly 500,000 sq. ft. assembly plant in Chillicothe, OH, expects to complete a major, technology-rich expansion in November. The "building on top of our building," as Plant Manager Judy McTigue referred to it, "speaks to our industrial engineers' ingenuity," and editors got a chance to see why on Wednesday.

The addition will be a fully automated area for storing parts like cabs and painted panels, for instance, which now have to be stored in limited available space at the plant or outside at certain stages. With southern Ohio's weather, that's often "a real challenge," McTigue said.

Inside the plant, two separate elevator systems will bring parts up for storage or down as they're needed for assembly. It'll all be done by robotics and computers in a sending-requisitioning inventory system, according to McTigue, representing a significant efficiency improvement vs. current processes.

It's a $17 million project for the plant, and "we're excited about the investment," she noted. While a release from the company states the new facilities add 25,000 sq. ft. to the plant, McTigue told Fleet Owner it's considerably more than that, especially since the addition is three stories high.

"We'll be twice as tall as we are today," she said. Meanwhile, she added, the facilities expansion had to be planned and executed "while we continue to produce on both shifts." This has been a big year for the plant, which just rolled its 500,000th Kenworth off the line three months ago.

On that note, as a good indicator for Class 8 sales, the Chillicothe plant is now churning out 80 trucks on the day shift and 48 every night, according to McTigue. So it's a slightly dialed-down — but still high — production rate following market demand, and the company "did a good job feathering it down," she said, from 2015's higher production levels.

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Fuel economy, automation among 2017 Kenworth highlights

Today’s Trucking  /  May 19, 2016

Most of Kenworth’s trucks roll off the assembly line at Chillicothe, Ohio, so it was only fitting that the manufacturer showed off its 2017 lineup by rolling vehicles past the facility’s front gates.

Maybe “gliding” would be a better word. Enhanced fuel economy is clearly driving some of the most recent updates.

The flagship T680, when incorporating an aerodynamic Advantage package, is now available with a new partial fairing under the sleeper, better directing air out and around the rear wheels and onto trailers. An optional fuel fill point under the sleeper allows fuel tanks to be moved forward, too, further enhancing aerodynamics by reducing trailer gaps and wheelbases.

But that’s not the only fuel-saving enhancement on the truck that includes the MX-13 engine, automated Eaton Fuller Advantage transmission, and fuel-efficient drive axles. There’s also the option to include Predictive Cruise Control, which combines maps and GPS to decide if a truck should coast over the crest of a hill, harnessing the power of gravity to keep things on the move.

“The growth of Automated Manual Transmissions has been significant for Kenworth,” added Kurt Swihart, marketing director, when briefing industry media. A few years ago, barely a quarter of T680s were delivered with the self-shifting designs. This year, close to 70% were equipped that way. “A lot of younger drivers today are not familiar with manual transmissions and prefer to be able to drive an automated transmission,” he said.

There is more automation to come. The Allison TC10 automatic transmission will be available sometime in 2017, and he expects several markets to embrace it. “I think the TC10 will be attractive to Pickup and Delivery types of applications – applications where there is a lot of braking and acceleration,” Swihart said. Just don’t expect Kenworth to adopt the ZF transmissions now used by their European counterparts who equip DAF trucks. “The Eaton partnership is very strong.”

Technology is making its presence known in other ways as well.

Last month came the addition of an engine oil temperature monitor, ideal for those in cold climes who are concerned about issues like fuel gelling. Trucks with the auto-start-stop feature will even start without drivers inside if the temperature drops to sub-freezing conditions, which can be defined by fleets themselves.

Meanwhile, the Bendix Wingman Fusion – which draws on a camera and radar – is now in production, offering adaptive cruise controls and lane departure warnings. Follow someone too close, and the alarm begins to sound. Unlike previous generations, this system can also detect stationary objects. About 30% of all T680s are already spec’d with Bendix Wingman, and Kenworth expects the share to grow.

Sleep tight, haul light

One of the latest options to begin production is the 40-inch sleeper for the T680 and T880. This promises some extra comfort while still shedding about 260 pounds when compared to the 52-inch regional sleeper. When coupled with the T880 it offers a match for petroleum haulers or towing operations that use straight trucks, as well as businesses that need the added space to haul lowboys.

Compared to the 38-inch AeroCab sleeper, there is an extra 22 cubic feet of storage space, even though the 87-inch roof is six inches lower than its counterpart. Other features include a 24x75-inch liftable bunk and cell phone cubby. Vocational customers will also appreciate hooks that are designed to hold hard hats and coats, and two standard toolbox doors. Both the Diamond VIT and Vantage interiors are available.

Views around the truck can be enhanced with 19x36-inch stationary or sliding windows on the back of the sleeper, helpful when manoeuvering in tight locations, and those can be combined with a pair of 19x12-inch outboard windows. Still other options include extreme-temperature insulation, LED marker lights, premium speakers, side extenders, and stainless steel sun visors.

The 76-inch mid-roof sleeper, launched last September, rounds out a lineup that includes a 76-inch high-roof used by most linehaul fleets, and the 52-inch mid-roof, high-roof, and day cab.

“That mid-roof option is a great option for many flatbed and tanker customers,” Swihart said, referring to how fuel economy can improve 5% when pairing a 76-inch mid-roof sleeper and a trailer or tanker that has a lower height. Running with a high-roof sleeper, after all, can create unnecessary drag against the upper part of the sleeper. “It acts as kind of a parachute in a way, by pulling the tractor back with the additional drag,” he explained.

The power

Then there’s the matter of big power in a smaller package.                     

The Paccar MX-11 engine, designed with weight-sensitive applications in mind, is expected by Kenworth to be a popular seller. That new power plant offers up to 430 hp and 1,550 lb ft of torque, and is available in the T880, T680, T800 with FEPTO (Front Engine Power Take Off), and W900S. Most important, it is about 400 pounds lighter than comparable 13-liter engines and almost 100 pounds lighter than 11-liter counterparts.

The six-cylinder, 24-valve design with double overhead camshafts injects fuel through a high-pressure common rail. The company says a graphite iron engine block with vertical ribs also helps to maximize strength and reduce noise.

“It’s an ideal engine for redi-mix customers,” Swihart said. Dump applications are using it, too, when customers are looking to shed weight from the overall packages. “We will see an increasing level of interest in LTL applications, Pickup and Delivery, and regional haul.”

Market share

For municipal, dump and tanker fleets, Kenworth has unveiled a “Baby 8” model in the form of the T370, with a 46,000-pound rear suspension and an 18,000- or 20,000-pound front suspension. The market could be 10,000 trucks across North America, Swihart added.

Kenworth’s K370 and K270 cabovers continue to grow in popularity among urban users as well, he said, referring to the models that feature decidedly automotive-like interior styling. “Trucking business is not necessarily their primary business,” Swihart said. “One of the elements behind our market share growth is the continued growth of the cabover in those markets.”

On the bigger side of the equation, the company’s vocational flagship in the form of the T880 now represents about 30% of sales. Combined with T800s – which has a narrower cab -- and W900s, vocational units still account for 40% of Kenworth trucks.

Maintenance tech

Then there’s the matter of keeping the trucks rolling.

TruckTech+ systems – now standard on the MX-11 – can monitor exactly how well the engine runs. The systems are already featured in about 10,000 Class 8 trucks, and come with a two-year subscription under the two-year standard warranty or Kenworth extended warranties.

 “That’s really the seed of a much broader connected truck platform,” Swihart said. “Right now it’s a one-way system where the truck is able to transmit information.” Over time? The messages could flow two ways. Tesla, for example, already offers over-the-air engine updates.

The TruckTech+ system emails guidance ranging from whether a driver should keep driving, have a fault addressed at the next service interval, head to a dealer, or pull over. When service is needed, the system maps the three closest repair facilities, and data is fed to fleet managers through a web portal.

DEF storage

Body builders will also enjoy some added room thanks to another option.

Diesel Exhaust Fluid tanks can now be removed from T680 and T880 frame rails, and replaced with a version that can be mounted above the fuel tank and under the cab. This means easier work for body installers when the tank is combined with an in-cab battery boxy, right-hand under-cab aftertreatment, or left-hand under-cab fuel tank.

Space is not the only thing that is saved. The US 7.3-gallon tank is 25 pounds lighter than the version it replaces.

Glide and ride

Recent changes have also focused on adding strength.

The T880 is now available with Hendrickson Ultimaax severe-duty rubber suspensions. On the T880, those are available with axle ratings between 46,000 and 52,000 pounds, axle spacings of 54-60 inches, and an 11-inch ride height. That’s a match for refuse, sand and gravel, cranes, platform trucks, and logging operations, among others.

Service life is said to be improved thanks to bar end bushings, a progressive load spring design and rugged axle connection. Replacements are eased with a progressive load spring design, while the axle connection is meant to reduce re-bushing needs. The suspension’s integrated walking beam also uses a central pivot point to keep tires in contact with the road, and the flat bottom increases ground clearance and offers a 17.5-inch diagonal wheel articulation.

The T370, meanwhile, now comes with 16,000-20,000-pound non-drive front steer axles and 44,000-46,000-pound tandem-drive rear axles. The MFS20 front axles and MT-44 and RT-46 rears can be spec’d with Paccar’s PX-9 engine rated up to 350 hp and 1,150 lb ft of torque. The offerings at the upper end of the spectrum open the truck up to be used by dump, fuel and mixing operations, among others.

The MFS20 front axles, meanwhile, come with 16,000-, 18,000-, and 20,000-pound Gross Axle Weight Ratings, and feature a front frame reinforced with cross braces, bolted cross members, and 10-3/4-inch frame rails or 10-5/8-inch frame rails with bolted cross members. The lighter engine and higher-capacity front axle combination are rounded out with iron hubs, dual-power steering gears, and a power steering cooler.

The 44,000-pound MT-44 rear axle and its 46,000-pound RT-46 counterpart are both designed to run 800,000 kilometers between lube changes. The T370 is also available with other rear suspensions rated up to 46,000-pounds.

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Latest Kenworth features showcased in ride-and-drive event

Fleet Owner  /  May 19, 2016

The latest features to be added to Kenworth's truck lineup were on display at a ride-and-drive event on Wednesday.

That includes the new Paccar MX-11 engine, a new Aero Advantage package fairing, a "clear back of cab" DEF tank, Allison automatic transmission and severe-duty suspension for heavy duty trucks as well as heavier-duty front and rear axles for the T370 medium duty, which makes that truck a "baby Class 8," according to company spokesman Kurt Swihart.

Slide Show - http://fleetowner.com/equipment/latest-kenworth-features-showcased-ride-and-drive-event#slide-0-field_images-191971

 

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Bolting in a Paccar MX-11 on the assembly line

Fleet Owner  /  May 19, 2016

Kenworth showed off its assembly plant and processes in Chillicothe, OH, including allowing this look at mounting and bolting in Paccar's latest engine, an 11L MX-11 diesel, to the chassis and frame of a new truck.

Click through the sequence to view this slice of production. This truck in particular, which was completed Wednesday, is a T680 for Oakland, CA-based third-party logistics company Dreisbach Enterprises; the engine is spec'd at 425 hp/1,450 lbs.-ft. of torque.

Though it was just launched a few months ago in January, Kenworth says the new 11L engine already is going into 5% of the T880 vocational trucks being produced. "It saves 400 lbs. over the MX-13 and it's great as a light-weighting option," noted Kurt Swihart, Kenworth's marketing director, adding that the company is seeing uptake of the engine in bulk hauling, less-than-truckload, regional haul and pickup and delivery applications.

"We very pleased and we see a lot of upside potential for it," Swihart said.

Slide Show - http://fleetowner.com/equipment/flipbook-bolting-paccar-mx-11-assembly-line#slide-0-field_images-191981
 

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Driving the Kenworth T680, T880

Truck News  /  May 19, 2016

Kenworth demonstrates comfort, efficiency and versatility of T680 and T880 models

A US$400-million investment by Paccar in the development of the Kenworth T680/T880 cab platform appears to be paying off.

“It has really revolutionized our business,” Kurt Swihart, director of marketing with Kenworth said of the T680 on-highway and T880 vocational models. The T680 was launched in 2012 and the T880 at the end of 2013. The two models now represent about 90% of the production at Kenworth’s Chillicothe, Ohio truck plant, which this week played host to a Right Choice customer event.

More than half the trucks Kenworth is building today are T680s, its flagship on-highway model. Additional sleeper configurations have been added to the truck over time, and that roll-out is now complete. The T680 can be had with a 76-inch mid-roof or high-roof, a 52-inch mid-roof or 40-inch sleeper. Swihart said most customers are ordering the 76-inch condo-style high-roof bunk.

But for those in tanker or flatdeck applications, the mid-roof can provide up to a 5% fuel economy benefit, while still allowing a 6’8” driver to stand upright.

The T680 Advantage is a fuel economy spec’ that was introduced in 2014 and now accounts for about a third of T680 sales. The Advantage comes with a series of fuel-saving specifications – chassis fairings, automated manual transmission and fuel-efficient drive axles – as well as the Paccar MX-13 engine. Swihart said it offers about a 10% fuel economy improvement versus a non-optimized spec’.

Subtle refinements to the package have been ongoing. For example, a new chassis fairing design is flared to better deflect air along the side of the trailer and away from the underbody. The new fairing replaced the previous one May 9.

More customers are spec’ing automated manual transmissions, Swihart noted, adding these now account for about 70% of T680 sales.

“A couple of years ago, maybe a quarter of T680s would get automated manual transmissions,” he said. “That has nearly tripled over the past three to four years.”

Kenworth has also added a battery-based idle management system to its portfolio to provide eight to 12 hours of air-conditioning. It can be coupled with an optional bunk heater and/or inverter for heating and power requirements. The company has supplemented this with a new auto start/stop system, which automatically starts the engine when the batteries need a boost. This new feature also monitors engine oil temperature and will start when necessary in cold weather to prevent fuel from gelling.

Also new to Kenworth is its TruckTech+ remote diagnostics platform, now installed on 10,000 vehicles.

“That’s the seed of a much broader connected truck platform,” Swihart said.

Another new offering is Bendix Wingman Fusion, a collision avoidance system that combines camera and radar technologies. Wingman is being ordered in about 30% of T680s, Swihart noted. The company is also enjoying a higher take rate for its proprietary Paccar MX-13 engine.

The T880 vocational truck is also enjoying an increased market presence. Kenworth still offers its predecessor, the T880, but most vocational customers have converted over to the new model.

Vocational buyers as well are showing greater acceptance of the MX-13, which can produce up to 500 hp and 1,850 lb.-ft. of torque. Complimenting the MX-13 is the new MX-11, which can provide a weight savings of 400 lbs compared to the 13-litre. Launched in January, the MX-11 can produce up to 430 hp and 1,550 lb.-ft., adequate for many vocational applications such as dump and ready-mix, Swihart said.

“The majority of sales have been in ready-mix applications,” he added. “But it’s also a great engine for dump applications, bulk haul – anywhere customers are looking for any way to be able to take weight out of the overall vehicle package.”

The 40-inch mini-sleeper was designed for vocational operators, especially those in the oilfield or in heavy-tow applications where the driver is only occasionally out overnight. It offers a 260-lb weight savings compared to the previously smallest available 52-inch bunk.

Turning to medium-duty, Swihart said Kenworth is coming off a record year in which it controlled 9.2% of the Canada/US Classes 6/7 segment. Sales were buoyed by the introduction of a new T370 configuration with 46,000-lb rear suspension rating.

“We think there’s a significant market opportunity out there,” Swihart said of the ‘Baby 8’ or heavy-medium-duty segment. It’s geared towards municipal, dump, tanker and other vocational applications.

A fleet of eight Kenworth trucks was made available for test drives. I spent time in the Kenworth T880 with 40-inch bunk, since it was designed with Canadian operators in mind. The T880 cab offers comforts and amenities that were carried over from the on-highway product and were once the exclusive domain of linehaul drivers. The sloped hood and expansive one-piece windshield offered excellent visibility.

The MX-13 engine with 500 hp and 1,850 lb.-ft. of torque was quiet to operate and pulled the 60,000-lb gross load uphill without any trouble. We were hauling cement blocks on a flatdeck trailer. The engine brake was remarkably quiet. The T880, much like its on-highway brother, was incredibly comfortable to drive. The 40-inch bunk featured a slim 24-inch mattress. You wouldn’t want to live in this truck but it’s a nice option to have when you’re making the occasional overnight run to someplace remote. Three rear windows offered visibility out the back and let in additional daylight. Extra storage can be found underneath the bed.

I also drove the T680 Advantage with 76-inch high-roof sleeper. This truck featured the new flared side fairing and was loaded up with safety options, including Bendix Wingman. It beeped at me when I followed too closely and would go so far as to apply the brakes while in cruise if necessary. I didn’t test that claim on this drive but I’ve seen it demonstrated before in controlled environments. It works well and should eliminate most rear-end collisions. Wingman Fusion now has the ability to detect stationary objects. That’s new. And its cameras can actually read roadside signage and tell on the driver who’s exceeding the speed limit.

Like the T880, the 680 offers incredible visibility and smooth, quiet ride. It was powered by the Paccar MX-13 engine rated at 455 hp and 1,750 lb.-ft. The 53-ft. van trailer was empty, so power was obviously available in abundance. Both the T680 and T880 have a nicely appointed automotive-styled interior. The high-def NavPlus HD screen can be used to display anything from additional gauges to turn-by-turn directions.

I also spent time behind the wheel of a T880 mixer and T880 super dump, two configurations that show off the versatility of this model.

Photo gallery - http://www.trucknews.com/equipment/driving-kenworth-t680-t880/1003072164/

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Class 8 outlook: Market factors could again drive business

Fleet Owner  /  May 20, 2016

If you're looking for economic barometers for trucking, Kenworth is seeing a lot of positive signs lately — but like others, predicts 2016 will be good, but not great, for Class 8 sales in the U.S. and Canada.

One indication of the Class 8 market is how many trucks are being churned out at assembly plants like Kenworth's in Chillicothe, OH. On an editors' tour on Wednesday, Plant Manager Judy McTigue noted the facility produces 80 trucks during the day shift and another 48 at night for a total of 128 per day; the lesser amount on shift two was "feathered down" a bit from last year in step with market demand, she said.

Kenworth Director of Marketing Kurt Swihart pointed out there are a number of indicators that could bode well for the heavy truck market. He noted that the company's product sales have shifted dramatically to its latest T680 on-highway and T880 vocational trucks, which were launched in 2012 and 2013, respectively.

Walking through the Chillicothe plant today, "it's very difficult to find one of our legacy models," Swihart contended. "I would guess that 90% of our current production here in Chillicothe is our T680 and T880 model lineup." With the T680 accounting for more than half of sales, the T880s are a big chunk of the rest.

For one thing, "housing and construction are doing well, and that's a big part of our business," Swihart said. "Whether it's road-building, whether it's commercial construction, whether it's housing, there's very good, robust construction activity [in the North American market] and particularly in the United States," he added.

Meanwhile, oil prices have been inching closer to the $50 mark per barrel of crude. "As oil prices dropped, it's kind of a double-edged sword for us," Swihart said. "It's good for fleets because they enjoy lower operating costs, but many of our customers are in the oilfield business, and much of that slowed down.

"Oil was priced below a sustainable level of profitable operations in many of those industries, and as oil is increasing, it's opening up some of those industries again," he continued. "That could turn from being a slight headwind for the industry back into a tailwind that will help drive business."

Overall, Kenworth is projecting Class 8 sales for the U.S. and Canada will be about 10-20% lower in 2016 than last year. "Our forecast for 2016 is Class 8 will be a market of 220,000 to 250,000 units, and we expect it'll be the third-highest year in the last 10 years. It is slightly down from nearly 280,000 Class 8 units in 2015, but it's still a very healthy market," Swihart said, referencing total retail sales.

In other good signs, Swihart pointed to truck tonnage increasing just in the last two or three months, as reported by the American Trucking Assns. Additionally, manufacturing saw a slight contraction closing out 2015 and in the first months of 2016 but is again on an upswing, he noted, citing the ISM Manufacturing Index.

"In recent months, manufacturing is expanding, and that's also good for our business," Swihart said.

 

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