ACT Research confirmed February's uptick in trailer orders this week, but the firm notes orders remain suppressed as weak freight rates continue to reduce carriers’ willingness to invest in equipment.
ACT says its final February orders were 20,500 units, up 6,600 units from January but 21% lower year over year.
“Seasonally adjusted, February’s orders fell to 20,100 units compared to a 12,600 seasonally adjusted rate in January,” says Jennifer McNealy, director, CV Market Research & Publications at ACT Research. “On that basis, orders increased 59% month over month. Dry van orders contracted 18% year over year, with reefers and flats both down 31% compared to February 2023.”
[RELATED: Weak freight fundamentals could shorten Class 8 order peak]
Other good signs from February were cancellations, which McNealy says “took a turn for the better in February, dropping to 1.3% of the backlog, from January’s elevated 3.2% rate.
She says, “Several markets remained above the 1% mark, with OEMs indicating cancellations from both fleets and dealers. Clearly, no one needs a higher trailer-to-tractor ratio or extra stock on the showroom floor in a market swimming in capacity.”
Finally, McNealy adds, “The good news is that healthy economic performance is increasingly favoring freight-generating economic sectors. However, capex remains limited at the start of 2024, and with impending expensive EPA regulations for power units, fleets are forced to make difficult decisions about how they spend their money, weighing on trailer demand.”
