Where are the Trailers?
Looking for New Equipment:
U.S. trailer orders dropped below 17,000 in October, according to industry forecaster FTR, far below a year ago when orders reached almost 55,000.
The supply chain remains clogged and labor availability is restricted due to well workers not wanting to work.
The challenge for many trailer makers is not to acquire more backlog but to manage the backlog they have, so many are not taking any orders.
What happens is that we are now experiencing unseen costs of old trailer sale. So if you have an old trailer and you want to make a lot of money, now is the time to SELL SELL SELL.
Currently old 2015-2016 trailer are going for the exact same sales price as brand new 2023 trailer.
Who is FTR?
FTR is the industry source for Transportation Intelligence. From freight demand to system capacity to equipment production, FTR adds over 270 years of industry experience into business decision-making. Our subscribers rely on FTR’s freight forecasting trends for improved forecasting in shipping, trucking, rail, intermodal, equipment, and financial communities.
According to FTR, Fleets need lots of new trailers; however, the manufacturers are being careful about how and when to slot these commitments into the build schedule. Monthly order numbers continue to understate the true demand.
What are OEMs doing?
Companies held back waiting for more clarity on the supply chain that has fostered a new operational model for managing uncertainties, Frank Maly, ACT’s director of commercial vehicle transportation analysis stated.
One trailer maker creating an hourly bonus if workers show up for a full work week — to ensure the manufacturer had a consistent staff level. Even with that, they still have issues with people showing up five days in a row, Maly said.
The broad shutdown during the coronavirus pandemic’s early days has forced people to redetermine what is most important in life. Employees are wondering what’s really important to them and how much money they really need.
At the same time, notions about what a basic trailer is and what it must have on it are changing to emphasize the equipment’s intelligence. The focus on smart trailers, is guided by operational improvements, emerging food safety regulations and the advances of the autonomous trucks.
“The pandemic just slowed down some of the transitions in technology. They haven’t stopped,” FTR said. “The pandemic and the supply chain issue right now have just overridden a lot of that.”
Where are the trailers?
Has recently opened quotes and orders for 2022.
“We anticipate that we will fill quickly for 2022,” said Sean Kenney, chief sales officer at Hyundai Translead. “It is highly doubtful that the industry will be able to produce enough equipment to meet the demand for the year.”
He agreed the supply chain remains very challenged on multiple fronts.
Stoughton continues to pass on price increases and although customers do not like this, “none of ours have walked away,” said David Giesen, vice president of sales at Stoughton. “As a matter of fact, our customers keep asking for more trailers, even as we hand them a price increase.” He said Stoughton does not have an “order board open for all” simply because there still is too much uncertainty in costs, availability and labor.
Great Dane has the order board open for a portion of the year, said Chris Hammond, executive vice president of sales at Great Dane.
“Customer demand continues to be above capacity for all trailer manufacturers.” He added: “I think employee retention is a concern for anybody in the U.S. doing business and we are not immune to that situation.”
Great Dane sees six trends that will define the future of truck and trailer connectivity:
Increased use of electronic control units in trailers.
Advances in edge computing
Autonomous vehicles will command how connectors are designed.
Changes in the physical shape of trucks and trailers will determine the needs of the new units.
There will be deeper collaboration between truck and trailer manufacturers
Improvements in manufacturing and implementation will help scale these new technologies and help bring them to market.