Despite the strong economy, shipments of new trailers dropped 17% in the third quarter and were down 5.6% for the year, according to the latest manufacturer survey by Economic Planning Associates.

“This weakening in trailer demand is occurring against a backdrop of continued expansion of the domestic economy and rising exports,” noted EPA President Peter Toja. Consumer spending rebounded in the third quarter. Rising merchandise exports and gains in manufacturing activity should increase flows of raw materials and finished goods. Rapidly expanding trade with Mexico and Canada should increase traffic volumes. Housing has slowed, but overall construction activities -- especially in nonresidential building -- continue to advance.
Toja said they expected a pause or “digestive phase” following record trailer sales in 1998 and 1999, but the third quarter dive was steeper than expected, particularly in light of so many positive factors in the trucking environment.
“There is little doubt that sharply higher fuel costs, increased driver pay and benefits, and costlier insurance premiums are sharply curtailing both trucker profitability and the desire to invest in new equipment,” he said.
From this point, EPA researchers expect a more gradual easing in quarterly trailer shipments, which will extend into the first half of 2001. A modest improvement toward the end of next year will set the stage for the next upward cycle starting in 2002.
The EPA survey puts total trailer shipments at 217,600 through third quarter 2000, down 5.6% from the same period in 1999. Van shipments totaled 169,000, down 5.1%. Dry freight van shipments were down 5.6%, insulated trailers were down 4.6%, drop frame trailers were up 28%.
Shipments of non-vans totaled 48,600, down 7.3%. Platform trailers were down 15.1%, lowbeds down 3.4%, dump trailers down 9.5%, bulk trailers down 9.3%, while tank trailers were up 5%.
For more information contact Economic Planning Associates at (949) 261-2904.