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Mack Trucks’ deliveries drop 49 percent

Written by Mehul Brahmbhatt on Dec 26th, 2007 | Filed under: Mack trucks, Trucking News

Mack Trucks‘ deliveries continued their slump in November, dropping 49 percent from the same month in 2006, its parent company Volvo AB reported Thursday.

But the market forces behind the weak truck demand have changed since earlier this year, when new emissions standards caused truck deliveries to plummet. Slow housing construction and freight demand are now to blame for the weak demand, which Mack expects to continue into 2008.

Mack delivered 1,539 trucks in November, down from 3,016 in the same month last year. Mack deliveries are a direct representation of demand for its trucks. The company does not manufacture trucks on speculation, but responds to orders from dealers.

Mack’s deliveries are slumping only in North America, which accounts for 70 percent of its November deliveries. In South America and Asia, Mack sales are enjoying robust growth because of increased marketing efforts in foreign countries experiencing economic growth.

Mack products are sold in more than 45 countries, and the number of trucks sold in the international market has tripled in the past four years, Mack spokesman John Walsh said.

”The growth in our international business is attributable to a number of factors, including an intensified focus on growing this part of our business, healthier and more stable economies in many parts of the world, a weaker U.S. dollar, and, in our particular case, becoming part of the Volvo Group, which has given us access to markets and resources we simply didn’t have before,” Walsh said.

But international sales remain a small market for Mack. So that success has only softened the blow for Mack’s downturn in the North American truck market, where sales so far this year are down 59 percent compared to last year.

Mack braced for a downturn in fall of 2006 by announcing it would lay off some of its 1,040 workers at its Lower Macungie Township plant, where it makes heavy-duty trucks. The company laid off 350 employees.

Stricter emission rules that took effect in January caused U.S. truck sales, including Mack’s, to plunge. Truck buyers stocked up on trucks in 2006 before the more expensive 2007 models hit the market. The company initially expected the slump to last six months, but then the housing market went bust. Heavy-duty trucks are used in the garbage, construction and freight industries.

In addition to its Lower Macungie plant, Mack employs about 1,000 people at its Allentown headquarters and testing site.



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