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Q4 trailer orders break record as December bookings stay strong

Consumer goods demand and improving manufacturing spike predictions

Preliminary net trailer orders in December 2020 exceeded 40,000 for the fourth consecutive month. and the October-to-December volume was the highest ever. (Photo: Great Dane)

Preliminary net trailer orders in December exceeded 40,000 for the fourth consecutive month. The October-to-December volume was the highest ever.

Orders have surged since bottoming out at near zero in April because most manufacturing was shut down because of the first wave of COVID-19.

Trailer orders have surged since bottoming out at near zero in April because most manufacturing was shut down because of the first wave of COVID-19. (Source: ACT Research)

However, increased demand for consumer goods from people homebound for work and school led to exploding freight rates. The order backlog is likely to keep trailer manufacturers busy through the year and looking to increase production.

Records set and broken

Orders of dry vans set all-time records in October and November. Refrigerated trailer demand was strong and flatbed trailers continued to recover.

“Fleet optimism continues to gain momentum,” said Don Ake, vice president of commercial vehicles at FTR Transportation Intelligence. “The growth should continue as people get vaccinated and employment rises. I also expect manufacturing activity to intensify soon. This will lift industrial-oriented freight.”

FTR reported preliminary net U.S. orders of 41,700 units in December, 6% above November and 155% higher year-over-year. ACT Research pegged U.S. trailer industry bookings at 42,500 net orders, 7% better than November and 140% above year-ago levels. 

Trailer orders for the year reached 297,000, more than 50,000 above projections at the beginning of 2020, FTR said. ACT put the annual figure at 288,000.

Trailer makers upbeat

“Great Dane experienced a tremendous quarter for sales as I suspect other van and reefer manufacturers did,” Chris Hammond, executive vice president of sales, told FreightWaves. “On the flatbed side, we saw the best two months of stock sales we’ve seen in over a year.  

“While [flatbeds] continue to lag other segments, we expect that sector will join the party later this year. We’ve underbuilt all year and there will be replacements needed,” Hammond said.

That demand could accelerate if the incoming Biden administration pushes for as much as $3 trillion in infrastructure spending to kick-start the pandemic-addled economy.

“While I am not certain whether it was a record or not for us, the last three months of the year were certainly very strong in all our product segments, with the final month meeting what we were anticipating as it related to forecasted orders,” Sean Kenney, chief sales officer for industry dry van leader Hyundai Translead, told FreightWaves.

Biggest backlog since April 2019

Consumer goods purchases should benefit from a second round of government stimulus checks. Vocational trailer orders should improve as manufacturing grows. 

“The last four months are very similar to the order surge in August-November 2018,” Ake said. “These orders have boosted the backlogs after hitting a low point in July during the throes of the pandemic.”

About 200,000 trailers are waiting to be built this year, the biggest backlog since April 2019, according to Frank May, ACT director of commercial vehicle transportation analysis and research. 

“At current production levels, many [manufacturers] would well be fully committed for 2021 production slots,” Maly said, noting that manufacturers will try to find ways to increase production.

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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.