The state of North American trailer manufacturing and truck freight in December 2020 indicates a positive end to a pandemic-affected year according to the latest reports from ACT Research and the American Trucking Associations.
Preliminary information for December, according to ACT Research, revealed that the US trailer industry booked 42,500 net orders. That was 7.0 per cent better than November 2020 and 140 per cent above year-ago levels.
For the full year (2020), estimated net order volume of more than 288,000 trailers was 40 per cent better than 2019.
“December activity closes a tumultuous year on a very solid up note,” said ACT Research Director CV Transportation Analysis and Research, Frank Maly.
“As has been the story throughout recent months, dry van demand continued to drive the market. While October and November were the best two dry van order months in history, final stats will likely show December not far behind, ranking fifth best.
“After rushing to the sidelines in the spring, fleets surged back into the market as the year proceeded, reacting to capacity challenges as well as higher freight rates. Those factors drove a dramatic shift in the short-to-medium term outlook for fleets, driving them to make aggressive investment commitments in the latter part of the year.
“Total industry backlog likely ended the year at more than 200k trailers, the best orderboard level since April 2019. At current production levels, many OEMs would well be fully-committed for 2021 production slots. However, OEMs will work to increase production levels as we move through the year, pulling that backlog horizon forward.”
Meanwhile, the American Trucking Associations’ (ATA) advanced seasonally adjusted (SA) For-Hire Truck Tonnage Index increased 7.4 per cent in December after rising 3.2 per cent in November. In December, the index equaled 120 (2015=100) compared with 111.7 in November.
“Tonnage ended last year on a high note,” said ATA Chief Economist, Bob Costello.
“The index not only registered the largest monthly gain since June, but it also had the first year-over-year increase since March. Freight continues to be helped by strong consumption, a retail inventory restocking, and robust single-family home construction. With the stimulus checks recently issued and with a strong possibility of more in the near future, I would expect truck freight to continue rising.”
November’s gain was revised down slightly to 3.2 per cent from the ATA’s 22 December announcement.
Compared with December 2019, the SA index rose 2.3 per cent. For all of 2020, compared with the same 12-month period in 2019, tonnage was down 3.3 per cent. 2019 had an annual increase of 3.3 per cent.
“Because of the pandemic, 2020 was obviously a very challenging year for the economy overall, and that is reflecting in the tonnage index’s dip from the previous year,” said Costello.
“Despite that, truck tonnage clearly outperformed the broader economy as freight continued to move in the face of a myriad of Covid-related challenges faced by the country.”
The not seasonally adjusted index, which represents the change in tonnage actually hauled by the fleets before any seasonal adjustment, equaled 115.9 in December, 5.4 per cent above the November level (109.9). In calculating the index, 100 represents 2015. ATA’s For-Hire Truck Tonnage Index is dominated by contract freight as opposed to spot market freight.
Trucking, the ATA said, serves as a barometer of the US economy, representing 72.5 per cent of tonnage carried by all modes of domestic freight transportation, including manufactured and retail goods. Trucks hauled 11.84 billion tonnes of freight in 2019. Motor carriers collected $791.7 billion USD, or 80.4 per cent of total revenue earned by all transport modes.
ATA calculates the tonnage index based on surveys from its membership and has been doing so since the 1970s. This is a preliminary figure and subject to change in the final report issued around the fifth day of each month. The report includes month-to-month and year-over-year results, relevant economic comparisons, and key financial indicators.