Healthy Rebound Not Happening For European Trailer Market

After trailer markets fell 51% in Western Europe in 2009, it had been hoped that a rebound of well over 20% would materialize, but the first half of 2010 featured an 8% decline from 2009.

Even though trailer registrations were improving and a full-year increase of 16% is forecast, it hasn’t matched expectations.

“Given how far trailer markets have fallen, the size of the rebound is somewhat disappointing,” said Gary Beecroft, managing director of consulting group CLEAR. “It is quite possible that the 2007 level of trailer demand will not be exceeded in the next 10 years. Even in the long term, the total size of the West European trailer fleet will exhibit little growth.”

The last severe downturn in the heavy-goods trailer market was in 1993, but this one is worse. In 1092-93, the demand for trailers fell by 31%, or 37,000 trailers. In 2008-09, the fall was 51%, or 107,000 trailers.

Normally, when the trailer market suffers a severe decline, the following two years will see something of a rebound. The normal pattern is a couple of years of double-digit growth followed by the market taking a breather. In fact, most of the West European markets will follow this pattern, but there are a few exceptions.

Germany, by far the largest market, had an exceptionally huge boom in trailer sales in 2007-08. Despite the massive decline in the demand for trailers in 2009, the country is still full of nearly new trailers. Many older trailers have been laid up awaiting better economic times. As a consequence, it will have a rather lazy recovery in 2010-11 and be out of sync with other markets.

By way of contrast, Switzerland’s trailer market, though small, was relatively stable, falling by a mere 27% last year. It therefore represents the opposite extreme, but having fallen less far it has less ground to make up, so, like Germany, will have a modest pattern of recovery.

In between lie all the other countries whose markets fell between 35% and 70% in 2009. Most will see growth of between 10% and 20% in 2010. Finland is the only country likely to have a worse trailer market than 2009. Some of the countries with the biggest economic headaches, whose markets have fallen the farthest, will have the biggest percentage rebounds in 2010 (Spain, Portugal and Ireland).

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