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January trailer orders slip as manufacturing capacity fills up

Year-over-year bookings up dramatically as equipment demand continues

January orders for trailers cooled off after four blistering months as trailer manufacturers tried to fill open positions. (Photo: Wabash National)

Trailer orders cooled off in January as manufacturers scrambled to keep up with four months of near-record bookings and considered whether to take orders to build in 2022.

“The order surge last September through December is actually somewhat of a limiting factor for additional orders in the short term,” said Frank Maly, ACT Research director of commercial vehicle analysis and research.

ACT reported preliminary January net orders of 29,100 trailers. That was up 94% from the same month last year but down 33% from December 2020. FTR Transportation Research put U.S. net orders at 30,000 units for January, up 83% from last January but down 34% from last month. Trailer orders for the past 12 months total 313,000.

ACT Research charts movement of trailer orders over the last 12 months.

Both analysis firms said January activity met expectations. Most large fleets already placed their 2021 requirements. Dry van capacity is limited. Demand for refrigerated vans has been robust for the past four months. Flatbed demand continued to rise in January.

“The good news about January orders is that flatbed orders continue to recover. This will allow OEMs to raise build rates through the first half of the year,” said Don Ake, FTR vice president of commercial vehicles.

“This means the manufacturing and the industrial sectors are showing strength. And this should translate to lower unemployment and GDP (gross domestic product) support later in the year.”

Trailer makers: Help wanted

Trailer makers need more workers.

“We continue to recruit for technicians at our 16 factory-owned branches and at all of our trailer and truck body plants,” Chris Hammond, Great Dane executive vice president of sales, told FreightWaves. 

Stoughton, Wisconsin-based Stoughton Trailers is actively seeking new workers. Success in finding them is limited.

“There seems to be more positions than available workers,” Dave Giesen, ‎Stoughton vice president of sales and marketing, told FreightWaves. “But we have been able to add to the workforce.” 

Wabash National Corp. (NYSE: WNC) said it added 600 new workers in the fourth quarter and expects to add 900 more by the end of March. CEO Brent Yeagy told analysts on the company’s Q4 earnings call that he no longer worries about being able to hire. He had expressed concern during the previous quarterly call.

Savannah, Georgia-based Great Dane expects some parts shortages because of the pressure that high demand puts on its supply chain.

“While there are industry shortages, we continue to work closely with our suppliers to mitigate production issues,” Hammond said.

Stoughton also expects a strained supply chain. “So far we are getting the components we need,” Giesen said,

When to take 2022 orders?

Great Dane and competitor Stoughton are taking different approaches to their 2022 order books.

Except for plentiful flatbed capacity, Great Dane has “very few spots for production starts at the end of the year. Great Dane’s backlog extends deep into 2021,” Hammod said. “So we’ll begin to plan the first couple of quarters in 2022 over the next few weeks with our partners.”

Despite high demand, Stoughton paused most orders toward the end of 2020 to get accurate pricing for material, Giesen said.

“2022 is a long way off and many things could change affecting pricing,” Giesen said. “We need to get closer and have firmer costing commitments from suppliers.”

Reluctance to take orders too early is understandable, said Francis Roy, vice president of vHub, a Saint Georges, Quebec, Canada-based trailer utilization platform.

“Forecasting of the costs that far out are too uncertain to build solid pricing structures,” he said.

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Alan Adler

Alan Adler is an award-winning journalist who worked for The Associated Press and the Detroit Free Press. He also spent two decades in domestic and international media relations and executive communications with General Motors.