The Russia-Ukraine war, related market impacts and uncertainty, along with difficult statistical comparisons following a post-COVID market rebound: It all adds up to slipping demand for trailers in Eastern Europe, according to the April 2023 forecast for the East European Heavy Trailer Market from CLEAR International.
“The Russian intervention in Ukraine will result in its trailer market falling back to the levels last seen after the occupation of Crimea in 2014,” Gary Beecroft, managing director of CLEAR International said. “The sanctions imposed on Russia, again, are having a real effect. In contrast Poland, Turkey and Lithuania will have strong markets in the post-covid forecast period.”
After weak trailer demand in 2020 caused by COVID-19, trailer registrations in the East European region posted a 42% increase in 2021, helped by huge growth in Poland and Turkey. In percentage terms, growth in 2021 varied from 6% in Russia to 112% but every country posted positives.
However, 2022 saw a 4.1% fall in trailer demand, with substantial declines within the countries most affected by the war in Ukraine—which included Russia and Belarus. Poland also had a large fall in demand but that was due to having record demand for trailers in 2021, which took sales to an unsustainable level.
For 2023, Clear International forecasts further decline of 13% in the region, due to the continuing war in Ukraine, the energy crisis, inflation, sanctions and of course a lack of business confidence which will delay investment in transport equipment.
The outlier in the region was Turkey, which had a 38% increase in trailer demand in 2022, Clear International noted. But with inflation running at 70%, companies with cash in the bank have spent on assets which will retain some value rather than watch it depreciate, the report noted. Furthermore, Turkey had relatively low demand for trucks and trailers in 2016-20, so a large amount of catch-up demand accumulated.
Trailer sales in 2018 were the third highest on record, only surpassed in 2007 and 2008. The forecast now is that registrations of new trailers will exceed the 2007 level in 2027, having surpassed the 2018 level in 2021.
CLEAR has upgraded the forecast 2023-2027 period has been upgraded in every year, in particular within Turkey, Czechia and Bulgaria.
Russia, the largest trailer market in Eastern Europe until 2010, suffered a 50% fall in demand between 2011 and 2015, largely as a consequence of the annexation of Crimea, but had an “astonishing” recovery in 2017-18 and was the largest market once again in 2019-20, the report stated. Turkish demand reached a new low in 2019, but recovery is already “well established” and it will remain roughly on the same level as Poland until the end of the forecast period.
The East European Trailer Market Report (April 2023), with forecasts to 2027, can be obtained from CLEAR by contacting Beecroft. A new report for the West European market was issued in March. A Global Trailer Database is also available and was updated in January.