COLUMBUS, Ind. — Weak freight rates continue to reduce carriers’ willingness to invest in equipment, resulting in low trailer orders and high cancellations in January, according to this month’s issue of ACT Research’s State of the Industry: U.S. Trailers report.
January net orders, at 13,700 units, were nearly 43% lower year-over-year and 10,700 units below December. Total cancellations took a turn for the worse in January, jumping to 3.2% of the backlog from December’s elevated 1.7% rate.
“Seasonally adjusted, January’s orders fell to 12,400 units from December’s 15,400 SA rate. On that basis, orders decreased 28% month-over-month,” said Jennifer McNealy, director of commercial vehicle market research and publications at ACT Research. “On a seasonally adjusted basis, dry van orders contracted 55% year-over-year, with reefers down 37%, and flats 34% lower compared to January 2023.”
McNealy added that “digging down into cancellations, several markets led the way, including dry vans at 4.2% of backlog and lowbeds at 1.5%. Clearly, with markets swimming in capacity, no one needs a higher trailer-to-tractor ratio. Additionally, both tank categories reported high cancels this month, with liquid at 3.7% and bulk at 10.2%. We continue to believe recent oil price weakness may bear most of the culpability there.”
Healthy economic performance is increasingly favoring freight, McNealy said, “but we are roughly balanced between the tail of an 18-month freight recession and the beginning of the next freight cycle, meaning limited capex available even with some dealers still challenged with more inventory than customers.”
Born in Pine Bluff, Arkansas, and raised in East Texas, John Worthen returned to his home state to attend college in 1998 and decided to make his life in The Natural State. Worthen is a 20-year veteran of the journalism industry and has covered just about every topic there is. He has a passion for writing and telling stories. He has worked as a beat reporter and bureau chief for a statewide newspaper and as managing editor of a regional newspaper in Arkansas. Additionally, Worthen has been a prolific freelance journalist for two decades, and has been published in several travel magazines and on travel websites.
