IF ADOLESCENCE is the period between childhood and adulthood, what should this time of year be considered?
We have 2014 behind us and 2015 ahead of us. Last year’s bills to pay with next year’s check. It’s a time to look back and a time to look ahead. And from where we sit, straddling 2014 and 2015, things look pretty good in both directions.
By just about any measure, 2014 has been an outstanding year. Truck body plants have been booming, chassis manufacturers are hard-pressed to keep up with demand, and truck equipment distributors have worked hard to convert these newly minted chassis and truck equipment into work trucks.
For trailer manufacturers, it’s been another outstanding year. Not only have market conditions come together to produce strong orders for trailers, but the industry also continues to benefit from pent-up demand resulting from the abysmal years we endured in and around 2009. Neither the trailer manufacturing industry—nor its customers—have the capacity to compensate for that loss of production overnight. The general sense is that 2015 will be another strong year in part because we couldn’t get it all built in 2014, and customers still need it.
Our industry is fortunate to be served by excellent market analysts. Last month’s issue (available at www.trailer-bodybuilders.com) contained a detailed forecast on the outlook for truck trailers. This month’s issue offers similar analysis for the commercial truck market. You can read our coverage of the annual National Truck Equipment Association’s new Executive Leadership Summit beginning on Page 30.
These forecasts are important to those involved in the day-to-day operations of commercial truck and trailer companies. It’s like checking your speedometer or your fuel gauge. You need to know the information and respond accordingly.
But what’s beyond the horizon? As always, we have plenty of things to think about that may or may not impact our business next year, next decade, or a generation for now. Here are a just a few:
• Finally, I got a job. According to the most recent job numbers, the hiring rate was the best since 1999. Will this breathe life into a still-weak housing market? If so, we could see an uptick in sales of service bodies, vans, and platforms.
• Where are the kids? The birth rate in the United States is at an all-time low. Where will tomorrow’s customers come from? Where will trailer customers get their drivers? Where will you get welders and shop technicians? How can you make your company a great place to build a career?
• We’re Number 2. While there are different ways to measure it, one yardstick says that China has now overtaken the United States as the world’s largest economy. Is it true? Does it really make much difference to us right here right now? One thing it can do is remind us: Never think your brand or company is invincible. Our industry has plenty of former giants who are now gentle.
• So you thought last winter was cold. According to the Rutgers University Global Snow Lab, there is already more snow on the ground in the Northern Hemisphere this autumn than in any year since 1976.
• Will OPEC attack Texas? The energy business is nothing if not turbulent. Yes, the United States is on the verge of energy independence. This flow of newly discovered domestic oil has driven prices down 30% in a matter of weeks. But many of the new wells are more expensive to drill. With its lower production costs, will OPEC be able to force American energy companies to scale back drilling plans? How will this affect our energy industry customers and the affiliated products that support them?
Here’s one last long-term question, based on Peter Zeihan’s presentation at the Executive Leadership Summit:
• Where can we go to get more immigrants? As the United States debates sealing the border and the issue of amnesty for illegal immigrants, we may be coming up on a time when these folks would much rather stay home. Zeihan says Mexico will be the “success story of the 21st century.” It will become a strong economy because of an influx of energy dollars, a younger demographic, which means a big labor market and growing consumer base. ¿Quieres comprar un remolque?
What goes around comes around. Eventually. ♦