As we’re putting the finishing touches on the annual Trailer Output Report—knock on wood!—2023 seems to have come in like a lion and gone out like … a well-fed lion.
Backlogs carried most trailer builders through midyear, at least. And more than a few have told me that orders are still doing well in 2024.
But with freight markets having bottomed out last year, and with not much hop in the rebound just yet, everyone is bracing for the first real slowdown since the pandemic kicked in about this time four years ago.
“The overall economy seems to be seeing a soft landing,” Jennifer McNealy, director, CV market research and publications at ACT Research told me. And that’s good news—except for that pesky lack of freight and fleets pulling back from their shopping spree.
“For the past few years, the challenges have been solidly on the supply side—and now it’s moved to the demand side,” McNealy said. “At the beginning of last year, the industry’s ongoing demand exceeded supply. As the year progressed, the supply side improved, but that was countered by softening demand, increasing cancellations, and dealers awash with inventory. Fleets increasingly chose the sidelines rather than centerfield.”
I’d given McNealy a call, first of all, because the ACT Research team keeps a close eye on the commercial equipment markets and their forecasts are hugely important to suppliers and manufacturers. More importantly, for the sake of this page, I’ve asked her to work with me to provide some additional analysis and insight for our annual trailer production roundup.
Specifically, we all know what happened last year—so what’s coming?
ACT began reducing the totals in its 2024 expectations “pretty hard,” beginning last summer McNealy said. The freight markets won’t improve until sometime in Q2 this year.
Read more: Trailer orders up month-to-month: ACT Research
Broadly, she suggested keeping an eye on consumer spending, particularly on goods versus services, as well as capital expenditures. For trailers specifically, freight rates are always an indicator. She’ll also be watching orders versus cancellations, and the backlog-to-build ratio.
“My biggest concern is what I’m hearing from the frontline,” she said. “The industry will be focused on maintaining the operational rhythm within an environment of reduced volumes for 2024.”
The bottom line: ACT forecasts the U.S. trailer market to come in at about 255,000 units in 2024, down from about 314,600 units in 2023. For 2025, the number climbs to 290,500. And 2026?
“I have to save something for our paying customers,” she quipped.
Fair enough. And to that end, the ACT Research 70th seminar, Market Vitals: The Current & Future Health of the Industry, will be underway about the time this edition of TBB ships. So look for more information about 2024 (and future) forecasts in next month’s magazine.
Also, speaking of upcoming events: Jason McDaniel will be representing us at Work Truck Week, and I’m rerouting to the annual meeting of ATA’s Technology and Maintenance Council. We’re trying to get Jason some more playing time with TBB, in hopes we can convince him to take a substantial role in 2024 as I tend to the editorial direction of Endeavor Business Media’s Commercial Vehicle and Infrastructure groups.
So please make him feel at home, as you have me. (I can’t believe it’s already been seven years.)
