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 the latest issue of ACT Research’s State of the Industry: U.S. Trailers report.
January net orders of 13,700 units were nearly 43% lower year over year and showed a drop of 10,700 units compared to December 2023.
In addition, total order cancellations took a turn for the worse in January, jumping to 3.2% of the backlog from December’s elevated rate of 1.7%.
“Seasonally adjusted, January’s orders fell to 12,400 units from December’s 15,400 seasonally adjusted rate. On that basis, orders decreased 28% m/m,” said Jennifer McNealy, director of CV market research and publications for 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,” she said.
Regarding cancellations, McNealy said several markets “led the way.” Dry vans accounted for 4.2% of backlog and lowbeds for 1.5%.
“Clearly, with markets swimming in capacity, no one needs a higher trailer-to-tractor ratio,” she said. “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, 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,” she concluded.
Linda Garner-Bunch has been in publishing for more than 30 years. You name it, Linda has written about it. She has served as an editor for a group of national do-it-yourself publications and has coordinated the real estate section of Arkansas’ only statewide newspaper, in addition to working on a variety of niche publications ranging from bridal magazines to high-school sports previews and everything in between. She is also an experienced photographer and copy editor who enjoys telling the stories of the “Knights of the Highway,” as she calls our nation’s truck drivers.
