Paccar and Ryder Anticipate Increased Truck Purchases Due to EPA Emissions Update
Paccar and Ryder System have highlighted a significant emissions update from the Environmental Protection Agency (EPA) that is expected to lead to a surge in the purchasing of older trucks.
The EPA’s phase three greenhouse gas emission standards, applicable to model years 2027 and onward, will impose stricter regulations on heavy-duty manufacturers. Many carriers interpret this as a reason to purchase vehicles before the new requirements come into effect.
“The industry generally anticipates a level of pre-buy activity due to the expected impact on initial costs and maintenance expenses,” said Ryder’s CEO and Chairman, Robert Sanchez, during an earnings call on April 23. He indicated that pre-buy activities might start as early as late 2025, similar to previous patterns where fleets acquire equipment a few years ahead of a mandated change.
Paccar shared a similar outlook, forecasting robust sales in 2025 and 2026. “The key question is when this pre-buy activity will commence and how substantial it will be,” stated CEO Preston Feight on an earnings call held on April 30.
In response to the EPA last year, the National Automobile Dealers Association warned that new emissions regulations could undermine the intentions behind them due to pre-buy activity. Fleets often hold onto older trucks longer than necessary or turn to the used truck market to avoid the complications associated with higher costs for new equipment.
However, the EPA’s prior research on pre-buys suggests a shorter timeline for this phenomenon. It indicates that pre-buy activities and delayed purchases are generally confined to “one year or less” before a regulation is implemented, with significant changes observed within a maximum of eight months.
A joint resolution introduced last week in both the House and Senate aims to revoke the EPA’s phase three measures. Trucking organizations argue that the Congressional Review Act needs to be enacted for this reversal. “The American Trucking Associations opposes the EPA’s GHG3 rule as it stands because the post-2030 targets are completely unattainable given the current status of zero-emission technology, inadequate charging infrastructure, and limitations on the power grid,” stated Ed Gilroy, Chief Advocacy and Public Affairs Officer of the ATA. Todd Spencer, president of the Owner-Operator Independent Drivers Association, emphasized that small business truckers, who make up 96% of the trucking industry, “could be regulated out of existence if the EPA’s flawed mandate takes effect.”
