Generally slower orders since the end of the first quarter, combined with steady production at high levels, have resulted in a 14% reduction in backlogs of trailers, according to ACT Research.
From the end of March through the end of June, complete trailer backlogs fell by 20,000 units, the Columbus IN company reports.
“While the backlog is experiencing its seasonal decline, it remains of sufficient size that production should remain near current levels through the end of the year,” says ACT Research’s Kenny Vieth. “Trailer production remained steady at just under 1,040 units per day through June and all of the second quarter.”
The company expects that stronger orders at year's end and into early 2006 will keep production close to current volumes through 2006 and into 2007. “If there is a caveat in the outlook, it is the potential of a short-term drag on trailer demand as truckers sort out their Class 8 strategies ahead of the 2007 EPA emissions mandate,” Vieth says. “It appears that truckers are poised to drive Class 8 production to a new record in 2006.”
While fleets may purchase tractors earlier than normal because of the forthcoming diesel emissions regulations, ACT still expects enough left in capital budgets for some trailers.
“Tractors won't do anyone much good without trailers,” Vieth says. “A growing economy, healthy trucker profitability, and an aging fleet ensure that truckers won't forget to buy trailers in 2006.”