Trailer orders close out the year on a softer note

ACT chart for trailer orders in December 2021

Preliminary reports show trailer net orders closed on a softer note, with OEMs booking 26,600 units in December, ACT Research reports. According to FTR, trailer orders for December retreated to 26,500 units, down 18 percent month over month and down 42 percent year over year.

ACT’s reports the 26,600 units is 17 percent lower than November and 40 percent below the previous year’s volume.

“After a very conservative path from April through August, OEMs cautiously began to accept additional orders in September. That careful posture continued through the remainder of the year. OEMs continue to balance staffing and supply-chain challenges as they seek to ramp production volumes to better fulfill fleet equipment demands,” says Frank Maly, ACT director, CV transportation analysis and research.

“Even with the lower December order volume, preliminary results point to month-over-month growth in industry backlog as the year closed, and it appears that 2022 production slots are now committed through August, at current build rates. This preliminary report puts the full-year 2021 net orders at almost 248,000 trailers, down about 17 percent from 2020. The decline is entirely the result of supply-chain and staffing issues, as OEM output continues to trail actual fleet demand,” Maly says.

According to FTR, OEMs continue to manage backlogs carefully as the supply chain disruptions persist. Order volume was very close to the average of the previous three months. Liquid tank trailer orders were sturdy. OEMs are booking orders a batch at a time as they estimate how many trailers they can build in future months based on parts and component availability. Fleets anticipate needing large numbers of trailers in the coming months, but OEMs are reluctant to enter all the commitments into the backlog under current conditions. Trailer orders for 2021 totaled 249,000 units, FTR reports.

“The trailer market has settled into a pattern similar to Class 8 trucks. Orders have now averaged 26,000 units for the past four months, only a few thousand more than monthly production. That means backlogs have only gone up 6 percent despite there being tremendous demand for new trailers. You won’t see the order numbers consistently rise until there are ample parts to support significantly higher production,” says Don Ake, FTR vice president of commercial vehicles.

“It appears that a labor shortage at domestic suppliers is now the No. 1 constraint. The flow of commodity materials has improved and even imported parts deliveries have increased. The employment level at the OEMs is also a significant issue. At least one OEM is offering $1,000 sign-on bonuses for all factory workers. It is anticipated that trailer build will increase steadily once the labor constraints loosen up,” Ake says.        

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