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January Net Trailer Orders Drop 58% Following Year-End Surge

February 24, 2023 Admin No Comments

January Net Trailer Orders Drop 58% Following Year-End Surge

U.S. trailer orders in January decreased 9% year-over-year to 24,300 from 26,595 a year earlier, reported ACT Research. This comes a month after net trailer orders reached their second-highest level on record at 57,300.

Also, orders dropped 58% from near-record results the prior month.

ACT Research noted that results reflect a lower build rate.

“Build-per-day decreased from the previous month’s unit-per-day rate,” said Jennifer McNealy, director of commercial vehicle market research at ACT Research. “OEM conversations continue to suggest supply chain constraints, including labor, are likely to remain a limiting factor to production in 2023.”

McNealy had expected net orders to slow following the surge that ended 2022. She views the results as a return to more normal levels. ACT Research found that lower orders of van types and flatbeds were offset somewhat by increased placement for low-beds and tanks.

“Demand overall remains strong, and cancellations are low,” McNealy said. “But we are hearing that some orders are being made to replenish dealer stock, rather than going directly to fleet customers.”

ACT Research noted that the backlog-to-build ratio increased to 9.9 months in January. It has been averaging roughly eight months since August 2021. But the ratio for total trailers decreased to 8.1 months when seasonally adjusted.

“While December numbers were record-level order numbers, we did see the numbers fall more into line in January,” said Chris Hammond, executive vice president of sales at Great Dane. “I don’t read much into any single month anymore as the last two or three years have made short-term indicators less relevant without a lot more context.”

Hammond believes fleets are continuing to order for replacement as they do not want their equipment to get out of balance because of age. He noted some fleets have held onto older trailers as capacity for new units was very constrained. He has seen some fleets ordering units for growth but that growth demand has waned recently.

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