COLUMBUS, Ind. — Weak freight rates continue to reduce carriers’ willingness to invest in equipment, resulting in low trailer orders and high cancellations in January, according to the latest issue of ACT Research’s State of the Industry: U.S. Trailers report.
January net orders of 13,700 units were nearly 43% lower year over year and showed a drop of 10,700 units compared to December 2023.
In addition, total order cancellations took a turn for the worse in January, jumping to 3.2% of the backlog from December’s elevated rate of 1.7%.
“Seasonally adjusted, January’s orders fell to 12,400 units from December’s 15,400 seasonally adjusted rate. On that basis, orders decreased 28% m/m,” said Jennifer McNealy, director of CV market research and publications for ACT Research.
“On a seasonally adjusted basis, dry van orders contracted 55% year over year, with reefers down 37%, and flats 34% lower compared to January 2023,” she said.
Regarding cancellations, McNealy said several markets “led the way.” Dry vans accounted for 4.2% of backlog and lowbeds for 1.5%.
“Clearly, with markets swimming in capacity, no one needs a higher trailer-to-tractor ratio,” she said. “Additionally, both tank categories reported high cancels this month, with liquid at 3.7% and bulk at 10.2%. We continue to believe recent oil price weakness may bear most of the culpability there.
“Healthy economic performance is increasingly favoring freight, but we are roughly balanced between the tail of an 18-month freight recession and the beginning of the next freight cycle, meaning limited capex available even with some dealers still challenged with more inventory than customers,” she concluded.
Born in Pine Bluff, Arkansas, and raised in East Texas, John Worthen returned to his home state to attend college in 1998 and decided to make his life in The Natural State. Worthen is a 20-year veteran of the journalism industry and has covered just about every topic there is. He has a passion for writing and telling stories. He has worked as a beat reporter and bureau chief for a statewide newspaper and as managing editor of a regional newspaper in Arkansas. Additionally, Worthen has been a prolific freelance journalist for two decades, and has been published in several travel magazines and on travel websites.
