According to ACT Research, preliminary net trailer orders rose about 4,400 units from August to September, but at 12,100 units, were lower compared to last September, down 61% y/y.
Seasonal adjustment (SA) at this point in the annual order cycle lowers September’s tally to 10,700 units, but that’s nearly 13% above August’s seasonally adjusted intake. Final September results will be available later this month. This preliminary market estimate is typically within ±5% of the final order tally.
“Since September is the traditional start to the order season, this month’s uptick was expected, said Jennifer McNealy, director CV Market Research and Publications at ACT Research. “It’s also no surprise that the data is significantly below the September 2023 intake, given the soft demand recorded throughout this year. September’s data brings ytd 2024 US trailer net orders to 101,600 units, a 34% contraction when compared to the first nine months of 2023, and puts Q3’24 net orders at just 27,000 units, 51% lower than the same quarter last year.”
According to McNealy, despite the sequential order improvement, September data continue to bear witness to our expectations of weaker demand against the backdrop of elevated order velocity the past few years, continuing weak for-hire truck market fundamentals, and already-filled dealer inventories. An order uptick showcasing demand, or the lack thereof, depends not just on one month, but on the next few months as OEMs more fully open their 2025 books.
“Industry anecdotes suggest that the ‘pause button’ is expected to remain pressed through the remainder of 2024, and those on the frontlines are expressing concern about 2025,” McNealy said. “The timing and size of 2025 order bookings is the wildcard. Additional indicators supporting the lack of optimism include still-elevated cancellations and backlogs lower than we’ve seen in a decade. Despite positive momentum in the US economy, lingering weak carrier profitability suggests little support for trailer orders to bolster 2025 backlogs into the end of 2024.”
FTR reported much the same as ACT Research.
According to FTR, September U.S. trailer net orders rose by 75% month-over-month (m/m) from a low base to 11,532 units but were down 63% year-over-year (y/y). Net orders were the lowest for a September since 2016. Despite the opening of 2025 order boards, the industry’s net orders fell well below expectations, raising concerns for the upcoming order season.
“Although trailer orders were weak in September, Class 8 orders slightly exceeded expectations at nearly 33,000 units for North America,” said Dan Moyer, senior analyst, commercial vehicles. “This divergence suggests that some fleets are prioritizing spending on new power units over trailers, possibly due to reduced profitability or shifting trade cycles. Higher-than-ideal trailer inventories at dealerships, lower fleet capital expenditures on trailers, and shrinking backlogs likely will put downward pressure on trailer build rates for the rest of 2024. If trailer orders for 2025 don’t pick up soon, some OEMs may extend or expand production cuts into next year.”
The challenging truck freight environment in 2024 is continuing to suppress U.S. trailer demand, according to FTR. Year-to-date (YTD) for 2024, total trailer net orders fell 31% y/y, reaching 92,642 units, averaging just 10,294 units per month. Total trailer build decreased by 11% m/m and 40% y/y in September, totaling just 15,617 units – the lowest monthly output since July 2020.
“In September, total net orders were once again below production levels, causing backlogs to drop by 4,255 units to just over 82,750 units,” FTR said in a media release. “The larger m/m decrease in production compared to backlogs pushed the backlog/build ratio up to 5.3 months. Despite this increase, it remains the second-lowest reading since July 2020 and is about 0.6 months below the pre-2020 historical average. This ratio suggests that manufacturers still have incentive to slow production further.”
Dana Guthrie is an award-winning journalist who has been featured in multiple newspapers, books and magazines across the globe. She is currently based in the Atlanta, Georgia, area.
