Preliminary net trailer orders for April reached 17,200 units, according to data tracked by ACT Research, which is a 15% increase from March’s order rate of 14,981 units. Yet that is about 5% below the order rate of 17,992 units achieved in April last year
Michael Baudendistel, vice president of Stifel Financial Corp.’s transportation & logistics research group, noted in a statement that
April’s trailer order rate “was somewhat stronger than we would have expected, given that April orders are generally weaker seasonally and considering the severe weakness in recent Class 8 orders.”
Yet he believes it is “unlikely” that trailer orders will be able to significantly outperform demand for Class 8 tractors, which Stifel expects will remain weak.
“We understand the arguments in favor of trailer demand outpacing Class 8 demand: favorable age demographic of trailers in the current active population, which are in need of replacement, and an increase in drop-and-hook activity, which necessitates more trailers per tractor,” Baudendistel explained.
“But while we believe those factors will cause trailer demand to hold up somewhat better than Class 8 demand, we believe the overall weakness in freight markets recently, poor TL and LTL pricing, and the historical correlation between tractor and trailer orders will continue to put pressure on trailer demand.”
