ECONOMIC WATCH: April trailer orders set historic low

BLOOMINGTON, Ind. - April trailer orders plunged to 300 units in April, the lowest level in the modern era, according to preliminary data from ACT Research. Orders are from U.S. manufacturers, and include those from Canadian carriers. April's orders were down 95% month-over-month, and 98% compared to last April.

The dry van segment was hit particularly hard, FTR reported, while vocational orders remained tepid. "Fleets remain in a severe wait-and-see posture until they can evaluate the damage done to the freight markets from the pandemic," said Don Ake, vice-president, commercial vehicles with FTR. "Since the recovery from the economic crisis is highly dependent on the status of the health crisis, there is a huge amount of uncertainty in the trailer market. Buying activity appears to be on hold until the fleets can see a clear path forward.

The bigger fleets will resume replacing old trailers as soon as they see the economic restrictions lifted and freight growing again." Ake said a recovery won't happen until fleet confidence improves. "Carriers saw freight softening at the beginning of the year and then it cratered due to the recession caused by Covid-19.

There are still way too many uncertainties present for fleets to buy new trailers in large numbers," Ake said. "They will take the minimum number of trailers needed in the short-run and then increase quantities dependent on the speed and size of the recovery.

Orders should improve soon, but are expected to remain modest for the next few months."

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