Trailer orders drop more than 90% in April, hit 30-year low

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Preliminary net trailer orders for April were a paltry 300 units, according to FTR – the lowest level on record dating back 30 years. Order totals last month were down 95% month-over-month and 98% year-over-year.

Carriers were not inclined to order new assets as uncertainly swirls around freight levels and an economy that is entering recessionary conditions. Many fleets have pulled back orders previously scheduled for 2020 delivery and there’s little appetite for new orders.

“Fleets remain in a severe wait-and-see posture until they can evaluate the damage done to the freight markets from the pandemic,” said Don Ake, FTR vice president of commercial vehicles. “Since the recovery from the economic crisis is highly dependent on the status of the health crisis, there is a huge amount of uncertainty in the trailer market.”

Ake said buying activity appears to be on hold until fleets can see a clear path forward, but he expects larger fleets will resume replacing old trailers “as soon as they see the economic restrictions lifted and freight growing again.”

The dry van segment was hit particularly hard last month and refrigerated van orders suffered some as well. Vocational orders remained tepid after falling significantly in March, FTR noted. Some specialty segments are holding up better under the stress.

“The key element to the trailer market recovery is for fleet confidence to improve. Carriers saw freight softening at the beginning of the year and then it cratered due to the recession caused by COVID-19,” Ake said. “There are still way too many uncertainties present for fleets to buy new trailers in large numbers. They will take the minimum number of trailers needed in the short-run and then increase quantities dependent on the speed and size of the recovery. Orders should improve soon, but are expected to remain modest for the next few months.”

Trailer orders for the past 12 months now total 162,000 units.