GlobalData (DATA) Investor Update summary

Macroeconomic and policy environment

• Tariff volatility and trade policy uncertainty are disrupting global and U.S. freight markets, impacting demand timing and inflation expectations.

• U.S. and Euro area recession probabilities are elevated, with consensus around 41-42% and stagflation risk at 60%.

• Inflation is expected to reaccelerate in the second half of the year, with high interest rates and policy uncertainty weighing on manufacturing and housing.

• U.S. economy entered 2025 with strong fundamentals, but policy and labor constraints are emerging headwinds.

• Uncertainty around EPA regulations and tax policy is complicating investment and fleet planning.

Freight and commercial vehicle market trends

• Carrier profitability has dropped to generational lows, with net margins falling from 10% in early 2022 to 2.7% in Q1 2025.

• Class 8 tractor production is forecasted to decline, with demand destruction evident since early 2024.

• Freight growth expectations for 2025 have been cut from 2.7% to 1.6%, with further reductions for 2026.

• Spot and contract freight rates remain weak, and order activity is unlikely to rebound in the near term.

• Record inventories and high interest rates are deterring new vehicle purchases, especially among small buyers.

Regional market outlooks

• Brazil faces high inflation and interest rates, with heavy truck sales pressured by weak agricultural margins and high input costs.

• Brazilian truck sales for 2025 are forecasted at 122,000 units, with upside if grain exports rise and downside if rates tighten further.

• Argentina is rebounding from recession, with truck sales up 109% in early 2025 and a projected 56% annual increase.

• Chile’s truck market is recovering, with 2025 sales expected to rise 8% over 2024, though still below 2021 levels.