A Hyundai Translead refrigerated trailer is on display at TMC 2024. (John Sommers II for Transport Topics)
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According to ACT Research, U.S. trailer orders fell 37% year over year to 7,200 units in July. The figure represents a 14.2% increase from June’s 6,300 units. The seasonally adjusted total was 10,300 units.
“Despite the sequential improvement in orders, July data continues to confirm our expectations of weaker demand given the increased order velocity of recent years, continued weak rental truck market fundamentals and already filled dealer inventories,” said Jennifer McNealy, director of commercial vehicle market research at ACT. “Nevertheless, it is important to remember that we are in the weakest months of the annual cycle in terms of orders.”
McNealy added that these weak conditions suggest there won’t be a catalyst for stronger orders before the fall, when truck makers open their order books for 2025. She expects fleets will be in a better position to buy equipment when they start making more money later this year, but notes that these expected improvements are from a low base.
“We continue to see sluggish order activity in the larger truck segments as tonnage remains stagnant or even declines,” said Chris Hammond, executive vice president of sales at Great Dane. “Most orders are coming from fleets that need to upgrade old equipment or those that have been awarded new routes or special contracts.”
Great Dane plans to monitor bid activity over the next few weeks as it responds to customer needs and opens construction projects for 2025. Hammond noted that despite weaker market conditions, the company continues to invest in itself to ensure it is ready to meet customer needs.
“We’re seeing some of the smaller to mid-sized customers being a little more opportunistic and taking advantage of falling prices in the market,” said Jeremy Sanders, chief commercial officer at Stoughton Trailers. “But I’m not really surprised that we’ve seen a trend of weak industry orders for several months now.”
RELATED: ATA reports further decline in truck tonnage for July
Sanders noted an increase in contract and spot freight activity, but his customers remain cautious about spending due to uncertainty surrounding the presidential election, interest rates and peak shipping season. He also noted that this phase of the cycle is typically slow for trailer orders.
“I’m very excited to see what happens in September, October and August when we start the (request for proposal) process for next year,” Sanders said. “However, I will tell you that not everyone is submitting a request for proposal right now, which leads me to believe there is still some caution.”
Sanders sees the market conditions as being down to caution and reticence from truckers with margin issues. Theresa Check, Senior Director of Sales at Hyundai Translead, agrees, noting that orders are declining seasonally due to market uncertainty.
“The current market and upcoming election have resulted in some cancellations,” Check said. “Dealers remain extremely cautious during this time as they sell off their current inventory in anticipation of the new model year.”
RELATED: Orders for Class 8 trucks weaken again in July
Check also noted that both rental and private fleets in general are still in the planning process for 2025. She pointed out that activity in dry cargo offers is increasing, demand for flatbeds and chassis continues to decline, and activity in refrigerated trailer orders has remained stable.
“It’s exactly what we forecast for the year,” said Steve Bennett, president and COO of Utility Trailer Manufacturing Co. “I would imagine there will be a slowdown in activity because with our plants full for the year and us just opening the 2025 calendar year, there’s hesitation. I don’t know if that’s the case across the market. The forecasting agencies are forecasting trucks and trailers more or less on the side.”
Bennett noted that it is difficult to communicate production plans to suppliers when industry forecasts show otherwise. He noted that the weak summer in trailer orders was in line with his prediction, but he suspected that this had more to do with carriers prioritizing other types of equipment than market weakness.
“It’s just that their capital is being deployed elsewhere,” Bennett said. “Fleets have definitely lowered their truck-trailer ratio.”
“But we’ve seen this as a pretty strong trend. There are a lot of really financially healthy freight forwarding companies.”
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