Demand for new trailers in Europe is now forecast to fall below the level of 2011, and consulting group CLEAR had lowered its forecast for 2012 by 10,000 trailers.
Gary Beecroft, managing director of CLEAR, said there are three factors driving this new forecast: business confidence is being undermined by the uncertainty as to whether one or more of the European economies is going to run into difficulty either paying its debts or selling government bonds to raise new finance; every economy in Europe is now forecast to have lower levels of business investment in 2012 than was forecast at the beginning of the summer; and some transport companies cannot finance trailer purchases at reasonable levels of interest as banks see transport companies as high risk.
These factors will be enough to choke off what was a promising recovery, he said. Although there will only be a small fall in trailer demand, the forecast assumes that there will be no sovereign default on debt, other than that which is known about in Greece. Should further problems emerge in Italy, Spain, Portugal or (less likely) Ireland, then “all bets would be off and we could see falls in the trailer market of 10% or more.”
Looking forward, CLEAR remains optimistic for 2013-14.
“Trailer demand has been well below the long-term trend level since 2009,” he said. “Even with a good level of growth in 2013-14, we will only just get back to trend at the end of 2014.”
In the meantime a backlog of replacement demand is building. Because the level of new trailer sales is still low, the trailer fleet size is both ageing and shrinking.