Distributors and manufacturers share sales expectations for 2025

NTEA recently released the findings from its 2024 end-of-year Business Conditions Survey. Available exclusively to participants, this survey offers valuable insights for work truck industry distributors and manufacturers, helping them navigate market trends and prepare for the year ahead. Key areas covered include: Sales levels and quoting activity Production backlogs Capacity utilization Employment trends Future challenges Application markets This article summarizes current results, integrating data from previous surveys for trend analysis and directional insights. The next survey is scheduled for distribution to distributor and manufacturer members in second-quarter 2025. Respondent demographics More than half (over 50%) of the survey participants identified as distributors, while approximately 45% were manufacturers. Regarding company size: 14% employ 10 or fewer individuals 12.7% have 11–20 employees 32.4% employ 21–50 individuals 21.3% have 51–100 employees 19.7% employ more than 100 individuals Geographically, most respondents operate primarily in the Midwest (29.6%) and South (18.3%). Other regions include the Northeast (11.3%), West (11.3%) and Canada (5.6%). Additionally, 15.5% of respondents operate across North America, while 8.5% serve the United States exclusively. Sales performance Sales among respondents increased by 1.7% in the second half of 2024 compared to the first half. As is usually the case, there were significant differences between distributor and manufacturer responses. The largest difference between the two groups was at the negative end of the range. Just over 13% of manufacturers reported that their sales were down more than 10% from first-half 2024. No distributors reported sales growth of less than 10%. At the high end of the range, though, about 8% of distributors and manufacturers reported growth of more than 10% in second-half 2024. Figure 2 shows expected change in sales growth from 2024 to 2025. In terms of this comparison, distributors expect to perform better than manufacturers. The average expected growth rate for distributors is 5.3%. For manufacturers, the expected average is 4.7%. As with the half-year comparison, the responses are a bit skewed at the high end of the range. Nearly 30% of distributors and manufacturers indicated they expect their sales to be more than 10% higher in 2025 than they were in 2024. In total, body and equipment sales are expected to be up 4.8% in 2025, which is very close to what was predicted back in July. Since the data reported in this survey is in dollar terms, growth rates include inflation. As 2025 will likely end with about 3% inflation, this means the 4.8% body/equipment sales growth will be closer to 2% after adjusting for inflation. As of October, total U.S./Mexico chassis sales were up just 2.4% in unit terms. In other words, survey respondents expect that body/equipment sales growth in 2025 will likely be about the same as chassis sales growth in 2024. Lead times As shown in Figure 3, lead times for Class 4–8 vehicles and tractors increased during the second half of 2024, while Classes 1–3, vans and pickups saw reductions. Notably, lead times for Class 5 and 7 vehicles rose despite high inventory levels, suggesting demand for specific builds not available on lots to fulfill demand. Employment trends Figure 4 shows 90% of respondents indicated stable or increased employment levels, while only 10% reported reductions. This stability reflects the industry’s overall resilience and growth outlook. Quoting activity Figure 5 indicates quoting activity rose for almost twice as many respondents as those who reported a decline, with 32.4% noting no significant change from the first half of 2024. Capacity utilization As illustrated in Figure 6, capacity utilization remains historically high, with most respondents operating above 75% capacity. As noted in the mid-year report, high utilization rates often signal increased capital expenditures. Anecdotal evidence suggests these investments may be directed toward machinery that enhances labor productivity or automates processes. Backlogs Backlogs increased in the second half of 2024, with 32.3% of respondents reporting delays exceeding 90 days, as shown in Figure 7. The most notable growth occurred in the 61–90-day category, which rose from 3.7% in June 2024 to over 10% in December. The 0–30-day category experienced a decrease, dropping from 42% to 33.8% over the same period. Differences between manufacturers and distributors were minimal, as indicated in Figure 8, except in the 31-60 day range, where distributors reported 15% compared to manufacturers’ 7%. Summary The survey results indicate strong conditions within the work truck industry. Capacity utilization remains robust, quoting activity is stable and sales are projected to grow moderately in 2025. While lead times and backlogs present ongoing challenges, the industry is adapting, supported by strategic investments in automation and productivity improvements. Overall, survey participants expect moderate growth in 2025 as the industry recovers from a slightly down 2024.

Distributors and manufacturers share sales expectations for 2025

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