Ringing in the new business as usual

It's time to look forward.

Last year — Trailer/Body Builders' 50th year of covering the commercial truck and trailer industry — was a great time to look back at the rich history of our past. After all, the present wasn't just a whole lot of fun for most of us during 2009. And especially in the first half of last year, the future was cloudy at best.

But our anniversary year is behind us, and as we talk with many of you, you are telling us that the recession is behind us, too.

Does that mean a boom is just around the corner? No. Does that mean that we can go back to doing things the way we did a couple of years ago? Not a chance. Now that there is no business as usual, we can't help but ask ourselves what business will look like in 2010. We are convinced that our industry is on the way to recovery, but we are also convinced that it will be a long time before we have boom times.

This past year has brought permanent changes to the structure of our industry. As we start a new year, it's appropriate to ask where are we now and where we are going.

To get a better idea, we spoke to a range of individuals who represent each major facet of our industry.

Let's start with the present. What are the key issues facing the industry in 2010? Here are the concepts our respondents cited most frequently:

  • Credit

    As in you can't get it. Despite the fact that the federal government has poured billions of tax dollars into the financial markets, lending institutions aren't lending all that frequently. Rather than loaning money, they are shoring up balance sheets and making sure that the risky behavior that exacerbated America's financial convulsions is not repeated anytime soon. How? By making it extremely difficult for customers to buy — even those with strong balance sheets. The effects of tight credit are cutting across all segments of the industry — manufacturers, trailer dealers, truck equipment distributors, and their would-be customers.

  • The economy

    Like a crime victim who has been assaulted and battered, the consumer is still not sure if it's safe to go out yet. They are convinced that the assailant is still in the neighborhood and that he might come back. And to a great extent, they are correct. Much of what is wrong with the economy has not yet been apprehended.

  • Cutthroat competition

    Ours is a competitive industry. But knives and scissors really fly when the size of the pie shrinks to half its size. Your competitor isn't just the guy on your left or right. It can be your supplier or even your customer.

Okay, that is a brief summary of the feedback we received on the present state of the industry. What does the future hold? The outlook of our respondents was tempered. We found no unqualified optimism, but there seems to be a guarded sense that we are on our way to a brighter tomorrow. Here are some of the factors that may shape our industry:

  • Regulations

    Regulators in Washington have been relatively dormant in recent years, but that is changing. Our industry appears to be bracing for a string of new regulations that will have significant impact on the nation in general and our industry in particular. Beyond simply affecting the ability of customers to buy trucks and trailers, these regulations — directly or indirectly — may dictate how trucks and trailers are designed and how they are equipped.

  • International trade

    Ours has become a global market, both in terms of completed vehicles and component parts. While the industry in general believes this dynamic will continue, there is also the sense that the trend could reverse, bringing more jobs back to North America.

  • Economic outlook

    Those we contacted seem to be convinced that the industry has seen the worst. The question now is how quickly we will recover and to what extent. The consensus is that the recovery will be slow and that it will be years before we will approach the prosperity we enjoyed a few years ago.

  • Market structure

    The toughest downturn we personally have experienced brought irreversible changes throughout the industry. Some of our customers are gone. Major truck brands no longer exist. Numerous truck dealers are out of business — but then again, so are some competitors.

So what's next? There is widespread agreement that we have weathered the worst of the recession. But there is also agreement that our industry will not be enjoying record production anytime soon. The good news is that we made changes in our companies last year. They now run smarter and leaner than ever before. To the extent that we can continue to apply the lessons we learned when we were at the bottom, there's no reason we can't post decent profits as we take the long journey back to the top.

Agree or disagree? Make your voice heard by visiting trailer-bodybuilders.com and clicking on “Contact Us.”

Hide comments


  • Allowed HTML tags: <em> <strong> <blockquote> <br> <p>

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.