Trailer Orders Jump 24% in May to Nearly 18,000

Trailer orders rose 24% to push toward 18,000 in May, and expectations are for demand to stay strong, ACT Research Co. reported.

Orders reached 17,889, ACT said, citing a net total. That compares with 14,459 orders a year earlier.

“Orders had a solid year-over-year performance. While down from April, the May results show that there is still some momentum out there from the late-starting order season,” Frank Maly, ACT’s director of commercial vehicle transportation analysis and research, told Transport Topics.

April’s net total was 20,668, according to ACT.

Orders have increased year-over-year every month since December, with both April and May posting year-over-year gains of about 25% or better.

The data show dry vans were the major contributor to the solid May performance, Maly said.

“Dry vans, while off month-over-month as history projects, were up almost 50% versus last year. Flatbeds, dumps and tanks also posted solid year-over-year results last month,” he said.

Separately, ACT told TT that 50% of the fleets polled in May for its latest For-Hire Trucking Index indicated they were planning only truck purchases, and 39% said trailers only. Also, 25% were planning purchases for both trucks and trailers.

In all, 61% of the fleets that responded are planning equipment investments in the next three months. This marked the strongest three-month reading since the third quarter of 2014, ACT reported.

Research company FTR pegged final net orders at 16,600.

“There were no surprises in May,” Don Ake, FTR’s vice president of commercial vehicles, told TT.

Replacement demand is “vibrant” in the dry van segment and “steady” elsewhere.

The expected shift to higher freight demand in the second half of the year should create more demand in many segments, he added. “This should provide decent market momentum rolling into 2018.”

New requirements the Environmental Protection Agency and National Highway Traffic Safety Administration promulgated in Phase 2 of their greenhouse gas final rule last year will begin to take effect for most trailer makers in 2018.

But trailer makers said they were not seeing signs of a pre-buy ahead of the implementation.

“We are not expecting a significant GHG Phase 2 pre-buy as most fleets are already compliant. But we are seeing fleets spec new trailers for longer life,” said David Gilliland, vice president of national accounts at Great Dane Trailers.

Those included features such as lights and wiring, floors and doors, Gilliland said.

“We see some pre-buy interest but, honestly, not that much,” said Glenn Harney, chief sales office at Hyundai Translead.

However, “Hesitation in the market due to both GHG and [electronic logging device] mandates may amplify the typical summer slowdown,” said Larry Roland, director of marketing at Utility Trailer Manufacturing Co.

A new federal requirement for drivers to their track hours of service using ELDs is set to begin in December. While many large fleets already are using the devices, some experts say independent operators not using ELDs may exit the industry rather than comply.

“Orders remain strong, but we expect the typical summer slow down to start anytime,” said David Giesen, vice president of sales at Stoughton Trailers.

The order flow year-to-date “is behaving as one might expect on the rising-demand side of the trailer-buying cycle,” Strick Group Chief Sales Officer Charles Willmott said.

ACT said orders year-to-date are 118,776.