At the IAA trade fare in Germany last week, component manufacturers were reporting a massive decline in demand from heavy trailer manufacturers, with orders down by as much as 50%. There were rumors of 20,000 to 30,000 unsold trailers littering the fields of Europe.

“Until this stock of trailers is cleared from the market there is little hope of an upturn for component orders,” said Gary Beecroft, Director of consulting group CLEAR. “That means no improvement until next year. I have heard the current market described as brutal.”

CLEAR has been forecasting a slowdown in Western Europe for the last two years. However, it had been hoped that the buoyant markets in the East would continue growing. The growth in the eastern market has averaged 27% over the last five years. In 2008, only 6% growth is forecast, and most of that is down to Russia alone. The Central European and Baltic markets are the worst affected, while Russia and its immediate neighbors have fared better.

The largest markets in order of size are Poland, Russia and Turkey, with these three accounting for 61% of the regions demand. Poland has witnessed the highest rate of growth. The markets in Russia and Poland are now as large as the biggest West European markets with the exception of Germany.

Another factor affecting these markets is that they have grown so fast that in many cases their trailer fleets are approaching the size that will fully meet their transport requirements. When that happens, the current high levels of trailer demand will fall.